Edited by Samuel MountjoyPersonal Loan Use Reaches New High; Rate Cuts May Drive More Activity
Quick Answer
Nationwide, 38% of consumers have a personal loan, according to Experian data. The percentage of consumers with a personal loan has increased every year since 2017.
More than 1 in 3 consumers (38%) nationwide currently have a personal loan—a share that has risen consistently since 2017, based on anonymized Experian data reported by creditors. Additional aggregated data and a recent Experian survey suggest that consumers will continue using personal loans in 2026 to refinance and consolidate higher-interest debt.
U.S. consumers continue to spend, based on recent retail sales figures, and credit card balances continue to climb. At the same time, record-high interest rates on existing credit card balances may be motivating more consumers to search for lower-cost ways to manage that debt.
Enter personal loans, which have become an increasingly popular option for consumers looking to cover purchases or consolidate their debt. These are typically fixed-rate installment loans repaid by the borrower on a monthly basis, usually for 36 or 60 months. Although personal loans secured by assets are common, many personal loans are unsecured.
The average rate consumers are paying on personal loans, according to Federal Reserve data, is significantly lower than the prevailing average credit card annual percentage rate (APR) of 22.3%.
More Than 30 Million Unsecured Personal Loans in Consumer Credit Reports in 2025
As consumers continue to manage higher-interest debt, including credit card balances, personal loan activity continues to grow. As 2026 begins, 67.5 million personal loans appear on consumers' credit reports, according to Experian data, up 7% from 63.2 million personal loans in 2024.
More than 30 million of those are unsecured personal loans, while the remaining loans are secured by a consumer's assets, such as vehicles or other types of collateral.
Personal loan balances grew by similar rates. Total unsecured personal loan balances reached $207.1 billion in 2025, up from $192.9 billion in the previous year.
| 2024 | 2025 | Change | |
|---|---|---|---|
| Unsecured personal loans | $192.9B | $207.1B | 7.4% |
| Secured personal loans | $362.3B | $390.4B | 7.8% |
| Combined | $555.2B | $597.6B | 7.6% |
Source: Experian data from September of each year
Personal Loans Becoming More Commonplace
Nationwide, 38% of consumers currently have a personal loan on their credit reports, according to Experian data. The percentage of consumers with a personal loan in their name has increased every year since 2017, and is growing even faster this decade—despite the introduction of newer loan products like buy now, pay later plans.
"Personal loans are increasingly a mainstream household finance tool," says Rakesh Patel, executive vice president for Experian Consumer Services Marketplace. "The share of consumers with a personal loan has risen steadily in recent years, and the total count of loans and balances have grown broadly across geographies and borrower segments."
Percent of Consumers With a Personal Loan, 2017 to 2025
Taking a look at the hard inquiries Experian receives from creditors, applications drove a 16% increase in 2025 for inquiries related to personal loans when compared to the prior year. Comparatively, consumer appetite for new credit cards (as measured by hard inquiries) wasn't quite as high in 2025.
Hard Inquiries in 2025 vs. Prior Year, Personal Loans and Credit Cards
And in nearly every state, more consumers have personal loans than the year prior, according to Experian data. Florida leads the nation with the greatest percentage point increase, but every state apart from North and South Dakota saw more consumers with personal loans.
Regionally speaking, Southern states have higher rates of personal loan uptake, while states in New England have a lower share of consumers with personal loans.
Expert's Take
Rakesh Patel
Executive Vice President, Experian Consumer Services Marketplace
"Our data show meaningful increases in inquiries and originations as borrowers move from consideration to action. Rate cuts have been a powerful near-term catalyst—they make refinancing materially more attractive and help convert consumer interest in the category into actually acquiring the loan."
Percentage of Consumers With a Personal Loan
Percentage of Consumers With a Personal Loan by State, 2024-2025
| 2024 | 2025 | Change | |
|---|---|---|---|
| Alaska | 39.9% | 40.6% | 0.6% |
| Alabama | 49.1% | 50.1% | 1.0% |
| Arkansas | 44.4% | 45.9% | 1.5% |
| Arizona | 38.1% | 39.6% | 1.5% |
| California | 32.3% | 33.4% | 1.1% |
| Colorado | 35.4% | 36.1% | 0.7% |
| Connecticut | 27.1% | 28.3% | 1.2% |
| District of Columbia | 25.8% | 26.5% | 0.7% |
| Delaware | 36.9% | 38.0% | 1.1% |
| Florida | 34.6% | 36.6% | 2.0% |
| Georgia | 42.3% | 43.5% | 1.2% |
| Hawaii | 38.2% | 38.2% | 0.0% |
| Iowa | 37.4% | 38.1% | 0.7% |
| Idaho | 42.8% | 43.9% | 1.1% |
| Illinois | 32.9% | 33.7% | 0.8% |
| Indiana | 40.3% | 41.4% | 1.1% |
| Kansas | 36.5% | 37.6% | 1.1% |
| Kentucky | 44.4% | 45.3% | 0.9% |
| Louisiana | 47.8% | 48.4% | 0.6% |
| Massachusetts | 26.2% | 27.1% | 0.9% |
| Maryland | 33.0% | 34.0% | 1.0% |
| Maine | 39.1% | 39.7% | 0.7% |
| Michigan | 38.1% | 39.1% | 1.1% |
| Minnesota | 35.7% | 36.3% | 0.6% |
| Missouri | 40.1% | 41.1% | 1.0% |
| Mississippi | 52.2% | 53.5% | 1.3% |
| Montana | 43.1% | 43.8% | 0.7% |
| North Carolina | 41.0% | 42.2% | 1.2% |
| North Dakota | 45.7% | 45.1% | -0.6% |
| Nebraska | 38.7% | 39.4% | 0.7% |
| New Hampshire | 34.2% | 35.1% | 0.9% |
| New Jersey | 26.2% | 27.4% | 1.3% |
| New Mexico | 47.7% | 48.2% | 0.5% |
| Nevada | 38.7% | 40.2% | 1.6% |
| New York | 27.4% | 28.3% | 0.9% |
| Ohio | 34.6% | 35.8% | 1.2% |
| Oklahoma | 46.8% | 47.4% | 0.6% |
| Oregon | 34.1% | 35.3% | 1.2% |
| Pennsylvania | 34.6% | 35.5% | 1.0% |
| Rhode Island | 28.4% | 29.9% | 1.5% |
| South Carolina | 46.1% | 46.8% | 0.7% |
| South Dakota | 43.9% | 43.8% | -0.1% |
| Tennessee | 44.8% | 45.6% | 0.9% |
| Texas | 45.7% | 46.2% | 0.5% |
| Utah | 40.5% | 41.4% | 0.9% |
| Virginia | 36.1% | 37.1% | 1.0% |
| Vermont | 37.0% | 37.7% | 0.7% |
| Washington | 33.1% | 34.0% | 0.8% |
| Wisconsin | 36.7% | 37.5% | 0.8% |
| West Virginia | 43.0% | 44.2% | 1.2% |
| Wyoming | 47.5% | 47.7% | 0.3% |
Source: Experian data from September of each year
Percentage of Consumers With Personal Loans in the 25 Largest U.S. Metros
Among the largest metros in the U.S., California provides the tale of two extremes for personal loan usage. In San Jose, the heart of Silicon Valley and one of the wealthier metros in the nation, only 20.2% of consumers currently have a personal loan—much less than the nationwide average of 38% in 2025. However, the Golden State also has the greatest use of personal loans among large metros in more working-class Riverside in Southern California, where 43.4% of consumers have at least one personal loan.
Percentage of Consumers With Personal Loans: Largest U.S. Metros
| Metro | Percentage of Consumers With at Least One Personal Loan |
|---|---|
| New York | 24.4% |
| Los Angeles | 33.9% |
| Chicago | 30.0% |
| Miami | 30.4% |
| District of Columbia | 29.6% |
| Philadelphia | 31.7% |
| Dallas | 41.3% |
| Atlanta | 39.0% |
| Boston | 25.5% |
| San Francisco | 23.2% |
| Houston | 42.8% |
| Phoenix | 38.6% |
| Seattle | 29.1% |
| Detroit | 35.3% |
| Riverside, CA | 43.4% |
| Minneapolis | 33.1% |
| San Diego | 32.0% |
| Tampa, FL | 38.1% |
| Denver | 33.9% |
| Baltimore | 33.8% |
| Orlando, FL | 37.3% |
| St. Louis | 37.3% |
| Portland, OR | 32.0% |
| San Jose, CA | 20.2% |
| Sacramento, CA | 33.1% |
| U.S. Average | 38.0% |
Source: Experian data as of September 2025
Out of nearly 400 total metropolitan statistical areas (MSAs) delineated by the U.S. Census Bureau, the percentage of consumers with at least one personal loan is above 50% in 70 of them.
Just as in the state-level view, more consumers in Southern U.S. cities make use of personal loans than in other U.S. regions, and by a significant margin. Of the nine larger metro areas (100,000+ population) where more consumers have a personal loan than not, all are in Alabama, Georgia, Louisiana, Mississippi, Tennessee and Texas.
| Metro | Percentage of Consumers With at Least One Personal Loan |
|---|---|
| El Paso, TX | 55.2% |
| Killeen, TX | 55.1% |
| Gulfport, MS | 54.1% |
| Corpus Christi, TX | 53.5% |
| Montgomery, AL | 52.2% |
| Clarksville, TN | 52.0% |
| Kingsport, TN | 51.7% |
| Shreveport, LA | 51.5% |
| Columbus, GA | 51.5% |
| U.S. Average | 38.0% |
Source: Experian data as of September 2025
Average Personal Loan Balance Nearly $20K; Still Below 2023 Levels
Consumers had an average personal loan balance of $19,333 in September 2025, according to Experian data. Average balances have stayed roughly unchanged since 2023, although the share of consumers with personal loans in their credit reports continues to grow.
Average Personal Loan Balance, 2021 to 2025
Delinquency Rate of Unsecured Personal Loans Remains Steady
Meanwhile, personal loan delinquency rates haven't increased or decreased meaningfully over the past two years. According to Experian data, the percentage of unsecured personal loan accounts 30 or more days past due on payments has hovered near 4% since 2024. This suggests that if there is additional financial strain impacting consumers, it isn't expressing itself in personal loan delinquency rates.
Delinquency Rate on Unsecured Personal Loan Accounts, 2024-2026
Most Consumers Have Had a Personal Loan Before; Half Think They're More Likely to Get One in 2026
Even before talk about lower credit card interest rates became headline news recently, credit card debt—and how to finance it—was already front of mind for many consumers heading into 2026, a recent Experian survey shows.
Most consumers (60%) are not only familiar with personal loans, they either have one now or had a personal loan in the past, according to an Experian survey of 1,005 consumers in January. Only consumers under age 25 are significantly less likely to have had a personal loan, which is largely a function of their less-established credit histories. Most prior and current personal loan borrowers have annual incomes of $50,000 or more.
Question: Have you ever taken a personal loan from a bank or other financial institution?
When asked why they got a personal loan, survey respondents cited major purchases, emergency expenses, home improvement and vacations more commonly than they did when asked the same question in 2024.
Question: For which of the following reasons might you use a personal loan?
Recent Experian survey data supports the assertion that borrowing is more front of mind than two years ago. When we asked consumers about how economic conditions are informing their use of personal loans this year, close to half (42%) said that they're more likely to use a personal loan in 2026 due to current economic conditions, both positive (lower borrowing rates) and negative (anticipating a need for funds in the near future).
Question: How have recent economic conditions over the past 12 months affected your likelihood of taking out a personal loan?
Only consumers with annual household incomes of more than $150,000 were much less likely to be considering a personal loan.
Percentage of Consumers Who Say They Are More Likely to Get a Personal Loan This Year vs. Last Year
Interest Rate Cuts Likely to Fuel Further Demand for Personal Loans in 2026
Interest rate cuts in recent months are also likely to further fuel personal loan growth in 2026. Here's why: Federal fund rate cuts lower the cost of borrowing for both credit card borrowers and prospective personal loan borrowers. Recent data suggests that typical personal loan rates rise and fall with the federal funds rate, the monetary policy tool the Federal Reserve manages.
Federal Funds Rate vs. Average Personal Loan Rate
And while credit cards falling a single percentage point may not excite many already beleaguered consumers, that same percentage point cut of a personal loan from 10% to 9% could translate to meaningfully lower monthly payments on personal loans.
"Recent Federal Reserve rate reductions have clearly accelerated personal loan activity," Patel says. "Because personal loan pricing typically moves with the federal funds rate, even a 1 percentage point decline can translate into materially lower monthly payments and make refinancing higher-cost revolving debt substantially more attractive."
Learn more: How the Fed Rate Cuts Impact Your Finances
Consumers Will Continue to Adapt to Affordability Challenges in 2026
Personal loans are becoming a more popular borrowing tool for consumers looking to improve their financial position. Primarily, that's taking the form of consumers accessing personal loans as a budgeting tool to better manage their higher-interest credit card balances. Lower financing rates on loans and increased consumer awareness could mean still more borrowers reaching for personal loans to manage rising costs in 2026.
Although consumers may be able to secure a personal loan with less than a good FICO® ScoreΘ of 720 or greater, those with higher credit scores will be able to secure the lowest borrowing rates on their unsecured personal loans, all other factors being equal. (Lenders will also take income and other factors into their decision-making.)
What to Know if You're Considering a Personal Loan
If a personal loan sounds like something that will help you meet your financial needs, consider using Experian's tools to browse loan offers matched to your credit profile. Whether you'll use the funds to get through a time of stress or to pay for a joyous occasion, a personal loan can be a great tool for managing expenses.
Applications for loans labeled No Ding Decline™⊛ in Experian's Marketplace won't hurt your credit scores if you aren't initially approved. That gives you greater freedom to find the loan that works for you without worrying about risk to your credit health.
Initial approval or acceptance of this loan may result in a hard inquiry, which may impact your credit scores. (A hard inquiry occurs when you apply for credit and the creditor checks your credit. Hard inquiries stay on your credit report for two years, but they only affect your FICO® Score for 12 months.)
⊛Applying for loans labeled 'No Ding Decline™' won't hurt your credit scores if you aren't initially approved. Approval of your application will result in a hard inquiry, even if you're unable to pass final verifications, which may impact your credit scores.
⊛Applying for loans labeled 'No Ding Decline™' won't hurt your credit scores if you aren't initially approved. Approval of your application will result in a hard inquiry, even if you're unable to pass final verifications, which may impact your credit scores.
Methodology: The analysis results provided are based on an Experian-created statistically relevant aggregate sampling of our consumer credit database that may include use of the FICO® Score 8 version. Different sampling parameters may generate different findings compared with other similar analysis. Analyzed credit data did not contain personal identification information. Metro areas group counties and cities into specific geographic areas for population censuses and compilations of related statistical data.
FICO® is a registered trademark of Fair Isaac Corporation in the U.S. and other countries.
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About the author
Chris Horymski
Chris Horymski leads Experian Consumer Service’s data research for Ask Experian, where he publishes insights and analysis on consumer debt and credit. Chris is a veteran data and personal finance journalist and previously wrote the Money Lab column for Consumer Reports and headed research at SmartMoney Magazine.
Read more from Chris