Finding the Best 36 Month Personal Loan Rates
Taking out a 3-year personal loan allows you to spread out payments over time for major expenses. But loan rates and terms can vary widely between lenders. So you’ll want to shop around for the most competitive 36 month loan rates possible before borrowing.
Doing research upfront keeps more money in your pocket long run. Read on for tips on securing low interest rates when financing personal needs for 3 years.
Compare Multiple Loan Providers
The first rule of thumb when seeking the best rates is to gather loan quotes from several different banks, credit unions, and online lenders. Avoid just applying with one lender. Failing to compare offers almost always results in overpaying interest charges.
Allow yourself at least several weeks to thoroughly research competing loan products and apply with multiple contenders. Using online loan marketplaces like Lending Tree helps streamline applications across lenders using soft credit checks that don’t impact your score.
But also apply directly with specific national banks, community banks, credit unions, and alternative digital lending platforms to compare all options. Cast a wide net to find the lowest 3 year fixed rates and customized loan packages.
Understand How Rates Are Set
Personal loan rates hinge firstly on the applicant’s credit scores and history. Borrowers with Very Good (740+) or Exceptional Credit (800+) qualify for the most favorable interest rates under 5%. Those with lower scores can still often get approved, but will pay higher single digit rates.
Beyond your credit profile, broader economic factors like the Prime Rate also influence lending rates banks offer. As the Prime Rate set by the Federal Reserve rises or falls with inflation and growth, loan rates tend to follow over time.
Competition between the thousands of banks and lenders nationally also presses rates down for consumers. When more lenders vie for your business, they lower pricing. Review Bankrate’s lending analysis to understand the marketplace.
And remember, published Annual Percentage Rates (APR) factor in all finance charges and fees. So compare APRs when loan shopping, not just the base rates different lenders promote.
Choosing Loan Duration
You can take out personal loans ranging from 12 months to 84 months typically. But data shows 3 year loans offer a sweet spot between minimizing total interest paid and maintaining reasonable monthly payments.
Borrowing for just 1 year brings lower overall interest charges but higher monthly bills. Long 6-7 year repayment terms have easier monthly payments, but force you to pay far more interest over the life of the loan.
36 month installment loans deliver the best blend of affordable payments you can handle each month and total money saved on interest. Make any large purchases or consolidate any existing debts over a 3 year timeframe ideally.
Know Your Credit Score and History
To secure the very best 36 month unsecured personal loan rates under 5% or 6%, you’ll need Excellent credit preferably over 740. But even borrowers with Scores of 670 can often qualify for decent rates under 10% these days.
Before applying for a personal loan, always first check your credit reports and FICO or VantageScore from Experian, Equifax, and TransUnion. Know your credit utilitization levels across all your existing accounts as well. Pay down balances as feasible to get approved for bigger loans at better rates.
Also recognize that even minor differences in Scores impact loan pricing. For example, someone with a 720 Score likely pays 0.5-1% higher rates than a borrower with a 760 Score applying for the same 3 year unsecured loan. So try to max your Scores first before submitting applications using tools from Experian and others.
Consider Secured Loan Options
Consumers struggling with very poor credit scores below 600 may find competitive 36 month loans elusive or pricey. In this case, exploring secured personal loans that require collateral may be your best bet.
Secured installment loans let those with damaged credit borrow money at reasonable fixed rates by backing the loan with a valuable asset like a car or savings account. If payments are missed, the lender can seize the collateral. But staying current builds your credit history.
Because defaults are less risky for banks, secured loan rates run only slightly higher than unsecured personal loan rates – often under 8% for 3 year terms. Secured loans also open the door for higher approval limits since assets back the transactions.
Just be cautious about putting up valuables you can’t stand to lose as collateral. Savvy borrowers only pledge assets they have enough equity in to cover the loan so that the item can be reclaimed even after seizure for missed payments.
Compare Loan Terms and Fees
Moving beyond rates, also contrast loan terms like borrowing limits, payments schemes, fees, and early payoff policies offered.
- What loan amount can you qualify for? Sufficient to cover your needs?
- Does the lender deduct payments automatically from your bank account?
- Are there late fees, origination fees, or prepayment penalties imposed?
- Can extra payments be applied directly to principal balances?
Read the fine print section of quotes meticulously to confirm you understand key loan stipulations before accepting offers. Getting the lowest 3 year rates won’t matter much if strict loan terms make borrowing untenable.
Reputable Lenders to Consider
While thousands of banks and online lenders offer personal loans, these lenders consistently offer some of the best unsecured rates for 3 year terms nationally to borrowers with good credit:
- Lightstream – Offers APRs as low as 3.99%. No fees. Flexible terms.
- SoFi – Great marketplace of loan options. Fixed rates from 5.74% APR.
- LendingClub – Established peer-to-peer lender charges APRs under 8% for 36 months typically.
Those with poor credit should consider these secured lending sources:
- Avant – Offers personal loans tailored for bad credit. Rates from 9.95% APR.
- Upstart – Uses education, experience to rate credit. Fixed rates under 12% APR.
- Credit Unions – Offer secured card options and installment loans with reasonable rates to members only.
Comparing personalized loan offers from multiple providers takes effort but secures consumers the best interest rates and loan packages. Those able to obtain 36 month installment loans qualify for reasonably priced fixed rate financing. Just be sure to also evaluate fees, limits, and terms before committing to lenders.
Conducting research on the front end keeps your financial house in order and saves money over the long run – particularly on larger personal loans. So set aside adequate time when seeking the right lending product to fund your needs and budget.
What credit score is needed to get the very best 36 month personal loan rates offered?
To qualify for the lowest rates under 6% from leading lenders on 3 year installment loans typically requires Excellent credit Scores over 740. But borrowers with Scores even down to 670 can often still find loans under 10% APR.
Where can borrowers with bad credit find reasonable 36 month personal loans?
Those struggling with very poor Scores below 600 should consider obtaining secured personal loans from alternative lending platforms like Avant and Upstart that offer competitive fixed rates by collateralizing the loan with an asset to reduce risk.
Should I take out a 3 year personal loan to consolidate high-interest credit card balances?
If you carry excessive revolving credit card debt charging 15-25% yearly, consolidating balances to a 36 month personal loan with a lower single digit fixed rate saves substantially on interest. Just be sure your monthly payments fit your budget.
What fees should I watch out for when seeking the best 36 month loan rates?
Read the fine print on quotes closely to identify origination charges, late fees, early repayment penalties or processing fees lenders may levy. Weigh overall pricing including fees – not just the advertised APR rates. Multiyear loans with zero fees are ideal.
Can I pay my 36 month personal loan off early without penalty?
Many top lenders allow prepayment of loan principal balances without penalty which helps you pay loans off faster and reduce total interest costs. But double check individual loan stipulations as some do charge modest early termination fees. Paying extra principal when possible maximizes savings.