Smart Ways to Use Personal Loans in 2026

In 2026, personal loan rates are looking pretty good. LightStream is offering the lowest rates, starting at 6. 24%. Wells Fargo and American Express are close behind, with rates as low as 6. 74% and 6. 99%, respectively. These rates are important because they show how much it costs to borrow money. When you take out a personal loan, you borrow money from a bank or online lender. You agree to pay it back over time, usually between one and five years. Each month, you pay a little bit of the money you borrowed plus some extra for the cost of borrowing. If you pay it back early, you might save money on interest. But watch out—some lenders charge extra fees for paying early.Most personal loans don’t require collateral, which means you don’t have to put up something valuable to get the loan. But because of this, lenders are picky about who they lend to. If you want the best rates, you need a good credit score. Aim for a FICO score of 670 or higher. Personal loans can be used for many things. If you have an emergency, like a car repair or vet bill, a personal loan can help cover the cost. If you want to improve your home, a personal loan can fund the project. And if you have multiple debts, like credit cards, a personal loan can combine them into one payment, making it easier to manage. But before you take out a personal loan, think about the fees. Some lenders charge an origination fee, which is a percentage of the loan amount. Also, if your credit score is low, it’s harder to get approved for a loan. Try to improve your credit score to get better rates.