Personal Loan Rates and Debt Statistics in 2024

Personal loan rates are elevated in 2024, and some lenders have tightened underwriting criteria in response to more delinquencies.
Annie Millerbernd
By Annie Millerbernd 
Edited by Kim Lowe

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Personal loans accounted for $245 billion in consumer debt in the fourth quarter of 2023, a $23 billion increase from the same quarter in 2022, according to data from the credit bureau TransUnion


Personal loans are offered by banks, credit unions and online lenders. They're typically unsecured and can be used for almost any reason. Lenders consider loan applicants’ creditworthiness, income and level of debt to qualify them and determine their annual percentage rates.

Public data on personal loans is unusually sparse compared to mortgages and student loans, but some credit agencies track information on personal loan debt. The data below shows how that debt has changed over time.

Recent facts about personal loans

  • Total personal loan balances reached $245 billion in the fourth quarter of 2023, up 10.5% from the same time in 2022, according to TransUnion.

  • About 23.5 million consumers had an unsecured personal loan in Q4 of 2023, up from 22.5 million a year prior.

  • Personal loan delinquency rates remain somewhat high at 3.9% in Q4 of 2023, but they are still lower than their peak of 4.14% in Q4 2022. Lenders have raised underwriting standards to avoid lending to those who may be unable to repay, likely leading to a drop in delinquency rates.

  • The baby boomer generation holds the highest average personal loan debt, according to Experian, but Generation X is gaining on them.

  • After their initial spike in 2022, average personal loan rates rose more slowly toward the end of 2023 and into early 2024.

Average personal loan rates

Personal loan rates aren’t heavily affected by occasional increases in the federal funds rate, but if the Fed pushes rates high enough, personal loan rates will also rise. Lenders also adjust rates based on supply and demand as well as large economic shifts.

Average personal loan annual percentage rates differ across online lenders, banks and credit unions, in part because they target different borrowers.

Online loans

Online loan rates usually range from 6.99% to 35.99%. An online lender may cater to a specific audience — like bad-credit borrowers (those with scores below 630) or those who want to consolidate debt — which can influence the rates it offers. In general, borrowers with good and excellent credit (scores above 690) get the lowest rates. However, lenders consider many factors, including income and outstanding debts, to determine your rate.

Bank loans

The average APR for a two-year bank loan is 12.49%, according to data from the Federal Reserve

The Federal Reserve. Consumer Credit Outstanding for February 2024. Accessed May 7, 2024.
. Large banks prefer borrowers with good or excellent credit, and some banks offer perks or rate discounts to existing customers.

Credit union loans

The average APR on a three-year credit union loan is 10.83%, according to the National Credit Union Administration

National Credit Union Administration. Credit Union and Bank Rates 2024 Q1. Accessed May 7, 2024.
. Federal credit unions cap APRs at 18%, so their rates typically skew lower than other lenders. A credit union may look beyond a personal loan applicant’s credit profile and consider their standing as a member, helping those with bad or fair credit qualify.

Average personal loan size

The average new personal loan was $7,400 in the third quarter of 2023, according to a credit industry report from TransUnion. Average new loan amounts have been between $6,000 and $8,100 in recent years.

Personal loan borrowing purpose

The most common reason NerdWallet users said they wanted to get a personal loan in the first quarter of 2024 was to consolidate credit cards and other debts, according to aggregate, anonymized data from NerdWallet’s lender marketplace.

Total personal loan debt in the U.S.

Total personal loan debt in the U.S. has grown steadily over the past several years with the exception of 2020.

Personal loan delinquency rates

According to TransUnion, 3.9% of personal loan borrowers were late on their personal loan payments by 60 days or more in the fourth quarter of 2023. Some lenders have hardship policies to help borrowers avoid defaulting. Lenders usually don’t report a loan in hardship as delinquent to the credit bureaus.

Average personal loan debt by state

Each year, credit bureau Experian releases an analysis of credit report data that breaks down personal loan debt by state. The data shows that in 2023 more debt was concentrated in the northern Midwest and Pacific Northwest than on the East Coast. Sunbelt states had the highest rates of loan balance growth from 2022 to 2023, however loan balances in those states were still lower than the national average.

A state’s average personal loan debt could be affected by things like cost of living and loan purpose. Even a small number of very large loans could throw the average off.

Unlike the average new personal loan balance, average personal loan debt can include more than one personal loan per person and isn’t necessarily new.

These were the states with the highest average personal loan debt in 2023, according to Experian


  • Washington: $31,483.

  • Oregon: $29,736.

  • Montana: $28,070.

Places with the lowest average personal loan debt in 2023:

  • Washington, D.C.: $13,507.

  • Georgia: $15,708.

  • New York: $15,925.

Personal loan debt by generation

Baby boomers had the highest average amount of personal loan debt in 2023, but loan balances grew fastest among millennials and Generation Z, according to Experian.

Here’s how much average personal loan debt each generation has, according to the credit bureau’s report.

  • Generation Z (18-25): $8,710.

  • Millennials (26-41): $16,669.

  • Generation X (42-57): $22,259.

  • Baby boomers (58-76): $22,551.

The personal loan amount you qualify for is tied to your income and creditworthiness. As Gen Zers increase their income and build their credit, their personal loan balances may also rise.

Personal loan APRs remain high, but relief may come this year

Quarterly increases in the federal funds rate (the rate that banks borrow at) contributed to a spike in personal loan rates in the middle of 2022. As a result, personal loan rates are the highest they’ve been since before the Great Recession.

For borrowers, that means it’s likely more expensive to consolidate credit card debts and finance home improvement projects with a personal loan than it would have been a couple of years ago. Higher interest rates have been reported across most financial products, including credit cards and home equity loans.

Some personal loan lenders have also tightened underwriting requirements to avoid lending to borrowers who may default, meaning those with fair and bad credit may struggle to qualify.

The Fed has signaled that it intends to lower interest rates in 2024, which would likely trigger lenders to soften their underwriting standards and provide loans to more customers, potentially at lower APRs.

As of May, it’s unclear when the Fed will cut rates and how much those incremental changes will impact personal loan rates.

Increase in credit card debt could raise demand for personal loans

Higher living costs and inflation drove credit card debt past $1 trillion for the first time ever in the fourth quarter of 2023, according to TransUnion. If the Fed cuts rates in 2024 and lenders loosen their borrowing requirements, more consumers may look to lower their interest costs and pay down credit card debt more quickly with debt consolidation loans, says Michele Raneri, TransUnion’s vice president of U.S. research and consulting.

Buy now, pay later companies start pushing subscriptions

An end to the seemingly too-good-to-be-true zero-interest loans offered by “buy now, pay later” companies may be in sight as more BNPL companies test subscription models to make money.

Klarna, for example, has introduced a $7.99 per month program that allows users to avoid paying service fees at retailers that are outside Klarna’s partnership network. The subscription also gets users $8 off their first purchase as a subscriber and discounts on purchases at certain retailers.

Afterpay tested an invite-only card that let users pay in installments nearly anywhere that accepted mobile pay for a monthly fee. Bloomberg reported in September 2023 that Affirm was exploring a plan that cost $7.99 per month.

Key terms to know about personal loans

Annual percentage rate is the interest rate on your loan plus all fees, calculated on an annual basis and expressed as a percentage. Use the APR to compare loan costs from multiple lenders.

An origination fee is a one-time, upfront fee that some lenders charge for processing a loan. The fee can range from 1% to 10% of the loan amount, and lenders typically deduct it from your loan proceeds.

The debt-to-income ratio divides your total monthly debt payments by your gross monthly income, giving you a percentage. Lenders use DTI — along with credit history and other factors — to evaluate a borrower's financial ability to repay a loan.

Lenders that offer pre-qualification typically do so using a soft credit check, which allows you to see rates and terms you qualify for without affecting your credit score. If you formally apply for the loan, the lender will perform a hard check to confirm your information. Hard checks knock a few points off your credit score.

See if you pre-qualify for a personal loan – without affecting your credit score
Just answer a few questions to get personalized rate estimates from multiple lenders.

on NerdWallet

Comparing options? See if you pre-qualify for a personal loan - without affecting your credit score
Just answer a few questions to get personalized rate estimates from multiple lenders.

on NerdWallet

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