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The average credit card interest rate sits at nearly 21% APR right now. If you’ve been carrying a balance, you already know what that feels like — you make payments, but the interest keeps pulling you back.
If you applied for a 0% intro APR card and got denied, that stings. But it doesn’t mean you’re out of options.
A personal loan — specifically, using one to consolidate high-interest debt — is another option I see many people overlook when trying to save money on interest. It’s not a magic fix, but for the right person with the right plan, it can genuinely help.
Why a personal loan might beat your credit card rate
The average interest rate on a 24-month personal loan from a commercial bank was 11.65% as of late 2025, according to Federal Reserve data and Motley Fool Money research.
That’s a meaningful drop from the average credit card charging ~21% APR.
But these are just averages. The reality is your actual rate for almost any loan product relies heavily on your credit score.
Below are some illustrative examples — your actual rates will vary — but they show how the gap between personal loan and credit card APRs can play out across different credit profiles:
| Credit Profile | Personal Loan APR | Credit Card APR | Rate Gap |
|---|---|---|---|
| Very good credit (740+ FICO) | ~9% | ~19% | 10 points |
| National average | ~11.65% | ~21% | 9 points |
| Poor credit (sub-580 FICO) | ~21% | ~28% | 7 points |
The takeaway: even if your credit isn’t great, a personal loan can still make sense — especially if your card is charging a penalty APR. Every percentage point you shave off matters.
How to shop for a personal loan the right way
Before you apply anywhere, you can shop around and prequalify with multiple lenders.
Most prequalification checks use a soft credit pull — which means no hit to your score. You’ll get a realistic rate estimate before committing to anything.
A few things worth knowing as you shop around:
- Watch for origination fees. A low rate might look great, but paired with a 5% origination fee it can easily wipe out your savings.
- Check your local credit union. Federal credit unions are capped at 18% APR by law and often charge fewer fees than big banks.
- Compare the total cost of the loan, not just the monthly payment. Longer terms mean lower payments but more interest paid overall.
Our experts have researched and tallied up the most worthwhile providers with the best rates and terms available in 2026. To begin your search, compare top-rated personal loan offers from trusted lenders here.
Make a plan before you borrow
No matter which tool you use for debt paydown, having a clear payoff plan really helps.
Many people get tripped up the moment they consolidate a debt balance. The feeling of relief is so great that they slowly let the credit card creep back up.
You don’t want to be stuck with a personal loan and a new card balance. That’s worse than where you started.
My advice is to pick the shortest loan term your budget can handle. Set up autopay (some lenders knock 0.25% off your rate for it) so you never miss a payment.
Lastly, decide upfront what you’ll do with your old credit card after you move the balance. You don’t have to close it, but you do need a plan.
Other options if a personal loan isn’t the right fit
A few other plays worth knowing if a personal loan won’t work:
Nonprofit credit counseling can connect you with a certified counselor who may help negotiate lower rates with your creditors — free or low-cost. Two I trust and recommend are the NFCC (National Foundation for Credit Counseling) and MMI (Money Management International).
You can also call your card issuer directly. If you’ve been a reliable customer, a five-minute conversation about a temporary hardship rate costs you nothing.
The bottom line
Not qualifying for a 0% intro APR card isn’t a dead end.
A personal loan for debt consolidation — used with a real plan — can lower the rate working against you and give you a finish line that a revolving credit card balance never does.
Find the right personal loan and start paying less in interest today.
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