Why personal loans are on everyone’s radar

Unsecured personal loans have exploded in popularity over the last few years. TransUnion’s 2025 Credit Industry Insights report found that outstanding unsecured personal-loan balances climbed to $269 billion in Q3 2025—up from $249 billion a year earlier . That growth reflects both wider access to credit and households feeling squeezed by housing costs, inflation and other essentials. More than 25.9 million Americans now have a personal loan , and about 51% of borrowers use their loans to consolidate higher-rate credit-card debt while 9.5% use them for everyday bills .

The interest-rate environment heading into 2026 is still challenging. According to Federal Reserve data, the average APR for a two-year personal loan from a commercial bank was 11.65% in November 2025 , while credit-union loans averaged 10.64% for a three-year term in December 2025 . Those high rates mean you’ll save by improving your credit and shopping carefully—especially since the Federal Open Market Committee cut the federal funds rate to a 3.5–3.75% range in December 2025 , but hasn’t yet reduced borrowing costs significantly.

NerdWallet’s anonymized pre-qualification data shows that borrowers with excellent credit (scores ≥ 720) averaged 11.81%, good credit (690–719) 14.48%, fair credit (630–689) 17.93% and poor credit (below 630) 21.65% . In short: strong credit translates into lower costs.

Below is a practical roadmap for securing a personal loan in 2026 while avoiding common pitfalls. It blends current data, proven strategies and a geo-friendly approach tailored for readers in the United States.

1. Check your credit and strengthen it

Your credit score has a huge impact on whether you’re approved and the interest rate you’ll pay. Experian recommends checking your credit score and understanding how much you need to borrow . Credit scores range from 300 to 850, with FICO® categories defined as poor (300–579), fair (580–669), good (670–739), very good (740–799) and exceptional (800–850) .

• Pay down existing credit-card balances and catch up on any past-due accounts.
• Limit new credit applications and dispute errors on your credit reports with the major bureaus.
• Use tools like free credit-reporting services to monitor progress and adjust your strategy.

2. Decide how much to borrow and estimate payments

Determine the exact amount you need—avoid borrowing extra “just in case.” Experian advises borrowers to calculate how much they need to borrow and estimate a monthly payment before shopping for loans. Most personal loans are repaid over two to five years; longer terms lower your monthly payment but increase total interest paid.

3. Shop around and compare offers

NerdWallet reports that commercial banks’ APR ranges can span from under 7% to nearly 30% , while credit-union loans often top out around 18% .

• Pre-qualify with multiple lenders.
• Compare total costs beyond the advertised APR.
• Consider credit unions and community banks.

4. Gather your paperwork

• Proof of identity
• Proof of address
• Proof of income
• Social Security number (or ITIN)
• Debt-to-income ratio documentation

5. Submit your application and avoid scams

Be wary of “guaranteed approval” offers or lenders requesting upfront fees. Report suspicious loan solicitations.

6. Use the funds wisely and repay promptly

Roughly 51% of borrowers take out personal loans for debt consolidation . Set up automatic payments and consider extra payments when possible.

Why choose Cash.com for your personal loan

If you’re ready to take control of your finances, complete the form at Cash.com and see how easy getting a personal loan can be.

Final thoughts

Demand for personal loans is poised to remain strong in 2026. Healthy borrowing starts with a plan—and Cash.com is here to help you make it happen.