Average Loan Interest Rates: Car, Home, Student, Small Business, and Personal Loans

Average Loan Interest Rates: Car, Home, Student, Small Business, and Personal Loans

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Depending on the type of loan you get, the average interest rate you’ll pay can vary from 0% to more than 200%. To calculate the interest rate for each type of loan, lenders may use your credit score, your credit history, loan size, term length, income, location, and various other factors relevant to the lender’s investment and the borrower’s risk.

Average Auto Loan Interest Rate

The national average auto loan interest rate typically ranges from 3% to 10%. According to Edmunds, loan terms vary but the average length for an auto loan reached a record high of 69.3 months in 2017. Based on a 60-month loan and a borrower’s credit score between 690 and 850, the 2017 average auto loan interest rate for a new car was 4.28%. Interest rates vary based on the credit score of the consumer, the term length of the loan, whether the car is used or new, and other factors related to the risk of lending to a particular consumer.


Consumers with credit scores that are above 690 may be offered auto loan interest rates of as low as 2%, although the averages range between 3% to 5%, depending on credit score. Borrowers with lower scores may receive an interest rate that is five to ten times that of consumers with the best scores. Another determinant of auto loan rates is whether the car is used or new. Used cars tend to have higher interest rates than new vehicles due to their lower resale values and the higher risk associated with financing a car that's potentially less reliable.

Average Mortgage Interest Rate

The national average mortgage interest rate for borrowers with good credit scores on a 30-year fixed-rate loan in 2017 was 4%. The rate will will pay mostly depends on the type of mortgage you get, its term length, and your credit score. While mortgage interest rates differ somewhat by state, those differences tend to be minimal. The most common mortgage loans are 15- and 30-year fixed-rate mortgages, which provide an unvarying monthly rate over the duration of the loan, and 5/1 hybrid adjustable-rate mortgages, which have a fixed rate for the first five years, after which they adjust annually.


Other types of mortgage loans offered include FHA loans, which are designed for lower-income consumers; VA loans, designed for veterans; and interest-only mortgages, which allow the borrower to pay only interest for their first few years, and so reduce their monthly payment. FHA and VA loans are backed by the government but the rates for these mortgages can vary, because they fluctuate based on the market and the borrower. For more information on mortgage payments, check our full analysis here.

Average Student Loan Interest Rate

Federal student loan interest rate depend on the type of loans you're eligible for. Most students use federal loans to finance their education, but there is also the option to instead use private lenders; also, some who borrow under a government program may later switch to private lenders to refinance or consolidate their loan. Each federal student loan has a universal fixed interest rate set by Congress every year. Credit score is not a factor for federal student loans, in contrast to most other loan types. Instead, the rate you'll pay varies by the type of loan you're getting, your income range and whether you are an undergrad or going to graduate school.

Loan Type
Borrower Type
2018-19 Rate
Direct Subsidized LoanUndergraduate5.05%
Direct Unsubsidized LoanUndergraduate5.05%
Direct Unsubsidized LoanGraduate6.60%
Direct PLUS LoanGraduate or Parents*7.60%

*Parent of Undergraduates

Student Loan Private Lenders

When you're looking to finance your education, it's best to use all available federal loan options before you apply for a private student loan. Unlike federal loans, any private student loans require you to make payments while you are in school, and they also tend to be more expensive than federal loans. Interest rates for private loans either can be fixed or variable, depending the type of loan. The average student loan interest rate has a wide range but some lenders offer interest rates as low as 2%, and rates can run as high as 18%, based on credit score. Any undergraduate, graduate, or parent can apply for a private loan. Approval for student loans involves a credit score and history check. Due to most students' lack of credit history, it helps to apply with a cosigner, typically a parent, to increase the likelihood of approval.

Loan Type
Interest Rates (APR)
Fixed Rate Private Loan*3.63% - 14.44%
Variable Rate Private Loan*2.93% - 12.73%
Private Loan Refinancing**2.57% - 8.24%

*Range taken from six popular private lenders (College AVE, Sallie Mae, LendEDU, Citizens Bank, PNC Ascent)

**Fixed and variable rate range taken from six popular private refinancing lenders (SoFi, Earnest, CommonBond, Laurel Road, LendKey, Citizens Bank)

Average Small Business Loan Interest Rate

The average small business loan interest rate from a traditional lender, generally a bank or credit union, ranges from 3% to 5.5%. Loans financed by an online lender may have interest rates that range from 6% to more than 100%. The interest rate largely differs by the type of lender and the loan product.

The most common lenders are banks, although there are an increasing number of other options from online and alternative lenders. Because these newer options are subject to fewer regulations for their small business loans , they offer a wider range of interest rates based on your business' credit score, financial statements, and even your personal credit score.

The table below shows the types of lenders and their average annual interest rates, assuming the borrower has a good credit score.

Type of Lender
Average Annual Interest Rate
Large National Banks2.55% - 5.14%
Small National and Regional Banks3.23% - 5.40%
Foreign Banks (made by U.S. branches)1.50% - 5.45%
Online or Alternative Lenders5.49% - 66.57%

Average Small Business Loan Rate by Loan Product

Average annual percentage rates for small businesses range from 4.25% to 200%. The range is due to the different types of financing businesses need. In the chart below, you can see the most common loan products and their APR range. The APR ranges listed below are inclusive of all types of borrowers and credit scores.

Type of Loan Product
Average Annual Percentage Rate (APR)
Bank Loans4.25% - 13.00%
SBA 7(a) Loans5.85% - 9.00%
Online Term Loans7.35% - 99.70%
Lines of Credit5.25% - 80.00%
Merchant Cash Advances12.00% - 200.00%
Invoice Factoring13.00% - 60.00%

Most consumers apply for term loans that are either given by banks, including Small Business Administration (SBA) backed loans, or by alternative lenders. With a term loan, you borrow a sum of money upfront and pay it back monthly for a set number of years. Other common loans include a line of credit, which gives the borrower access to a certain amount of funds at any given time; a merchant cash advance, an advance based on future revenues of a business; and invoice factoring, in which invoices are sold for a lump sum of cash to improve cash flow and reduce debt.

Average Personal Loan Interest Rate

On average, personal loan interest rates range from 10% to 28%, based on your credit score. Most consumers have a credit score between 660 and 720, which can vary depending on scoring model used.


Other factors used to determine the precise rate you will pay are your employment history, income, state or residence, and citizenship. Lenders will also evaluate the stability of your job and of the industry you are in, as well as your debt-to-income ratio. Regarding citizenship, H1B visa holders tend to have high interest rates from banks due to their short credit history and the higher possibility that a visa-holder may leave the country. To learn more about personal loans see our full article.