Smart Ways to Use Personal Loans in 2026

In 2026, getting a personal loan can be a smart move if you know how to use it right. Many lenders offer competitive rates, but it's important to understand the details before you borrow. Some top lenders, like LightStream and Wells Fargo, are offering rates as low as 6. 49% and 6. 74% respectively. American Express is also in the mix with rates starting at 6. 99%. These rates can change, so it's good to keep an eye on them if you're thinking about borrowing. Personal loans are a way to borrow money from a bank, credit union, or online lender. You pay it back over time, usually between one to five years, with monthly payments. Each payment covers both the amount you borrowed and the interest the lender charges. One big advantage of personal loans is that they are usually unsecured, meaning you don't need to put up collateral. However, lenders often have high credit requirements. If you want the best rates and approval odds, aim for a good to excellent credit score, typically between 670 and 850.Personal loans can be used for almost any legal purpose. They can help in emergencies, like unexpected home repairs or vet bills. They can also fund home improvements, adding value to your property. Another common use is debt consolidation, where you roll multiple debts into one loan with a single monthly payment. But before you take out a personal loan, there are a few things to consider. Some lenders charge origination fees, which can range from 1% to 10% of the loan. It's worth shopping around to find a lender that doesn't charge these fees. If your credit score is on the lower side, getting approved for a personal loan can be tough. Lenders usually consider scores below 580 as "bad credit" and scores between 580 and 669 as "fair. " To improve your chances, work on boosting your credit score to at least 670.