Shopping Around for a Personal Loan Could Save Consumers With 6 or More Offers Up to $3,138
Your APR can make a massive difference in the amount you pay over the length of a personal loan. Shopping around matters, as consumers with fair or good credit could save up to $3,138 by getting six or more offers, according to the latest LendingTree study.
We looked at personal loan offers among consumers who shopped around, examining various credit score ranges and overall. Here’s what we found.
Key findings
- Consumers could save an average of $1,659 by shopping around for a personal loan on the LendingTree platform. On average, there’s an 8.15 percentage point difference between the lowest and highest average APRs offered to consumers shopping in February 2024 for a three-year personal loan. Shopping around could save consumers up to 27.2% on interest owed throughout the loan term.
- Consumers with a credit score of 760 or higher could save an average of $2,234 by shopping around — the highest among the ranges analyzed. Meanwhile, consumers with a fair or good credit score between 640 and 679 face the highest average APRs. However, this group could still save an average of $1,859 over a three-year personal loan by shopping around.
- The more offers a consumer receives, the higher the potential savings. Consumers who received three or more offers for a three-year personal loan in February 2024 could save an average of $2,516. Consumers with three or more offers and a credit score between 640 and 679 could save the most, at an average of $2,685.
- When considering consumers who received six offers (the median number of offers loan shoppers got in February 2024) or more, savings are even higher. Consumers with six or more offers could save $2,731 on a three-year personal loan. With a 13.66 percentage point difference between the lowest and highest average APRs offered, borrowers could save up to 44.4% on interest owed throughout the loan term. Once again, the highest potential savings are for consumers with a credit score between 640 and 679: $3,138.
Consumers could save an average of $1,659 by shopping around for a personal loan
Analyzing offers in February 2024 on the LendingTree platform, we found that consumers could save an average of $1,659 by shopping around for a personal loan. That’s due to the APRs offered: While the lowest average APR offered was 24.81%, the highest was 32.96%. That’s an 8.15 percentage point difference. With an average minimum monthly payment of $413 and a maximum of $459, consumers could save $46 a month.
While the maximum payment over three years was an average of $16,512, the average closed loan amount on the LendingTree platform in February 2024 was $10,403 — a difference of $6,109. But shopping around could save consumers up to 27.2% on interest owed throughout the loan term.
With these savings in mind, LendingTree chief credit analyst Matt Schulz says shopping around is a must. “With loan rates still at or near record highs, borrowing is so expensive today,” he says. “Anything you can do to lower those costs is worth considering, and shopping around at sites like LendingTree is one of the best ways to accomplish that.”
How much consumers could save on average by shopping around for a personal loan
| Credit score range | Average APR offers | Average monthly payments | Total payments, 3 years | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Minimum | Maximum | Spread | Minimum | Maximum | Spread | Minimum | Maximum | Spread | |
| 640 to 679 | 26.21% | 35.23% | 9.02 | $420 | $472 | $52 | $15,131 | $16,990 | $1,859 |
| 680 to 719 | 23.58% | 33.11% | 9.53 | $406 | $460 | $54 | $14,611 | $16,543 | $1,933 |
| 720 to 759 | 19.56% | 29.63% | 10.07 | $384 | $440 | $55 | $13,834 | $15,823 | $1,988 |
| 760+ | 15.34% | 26.95% | 11.61 | $362 | $424 | $62 | $13,045 | $15,279 | $2,234 |
| All | 24.81% | 32.96% | 8.15 | $413 | $459 | $46 | $14,853 | $16,512 | $1,659 |
Source: LendingTree analysis of personal loan offers on the LendingTree platform in February 2024. Note: While we rounded for display, calculations were made with unrounded figures.
Diving deeper, consumers with the best credit scores could save the most by shopping around. Those with very good or exceptional credit scores of 760 or higher could save an average of $2,234 — the highest among the ranges analyzed.
Among borrowers in this credit score range, the lowest APR offered was an average of 15.34%, while the highest was 26.95% — an 11.61 percentage point difference.
Schulz says those with the highest credit scores tend to get the best terms on their loans because lenders consider them less risky.
That doesn’t mean those with lower scores can’t benefit from shopping around. While consumers with a fair or good credit score between 640 and 679 face the highest APRs, they could still save an average of $1,859 throughout a three-year personal loan by shopping around. For this group, the lowest average APR offered was 26.21%, while the highest was 35.23% — a 9.02 percentage point difference. That lower spread is the cause of the lower potential savings.
More offers could translate to higher savings
The point of shopping around is to get multiple options, so it may go without saying that the more offers a consumer receives, the higher the potential savings. But we wanted to show you the math behind the thinking.
Of those shopping for a three-year personal loan on the LendingTree platform in February 2024, consumers who received three or more offers could save an average of $2,516. Across all borrowers, the lowest average APR offered was 21.43%, while the highest was 33.90%. That’s a 12.47 percentage point difference — and it’s 4.32 percentage points higher than among all those who shopped around regardless of how many offers they received.
“Three is a magic number when it comes to shopping around,” Schulz says. “That way, you can get a real sense of what a marketplace offers. If you just get one or two offers, it’s hard to know if they might be outliers much more or much less expensive than the norm. Getting that third offer can help you figure that out.”
How much consumers with 3 or more offers could save on average by shopping around for a personal loan
| Credit score range | Average APR offers | Monthly payments | Total payments, 3 years | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Minimum | Maximum | Spread | Minimum | Maximum | Spread | Minimum | Maximum | Spread | |
| 640 to 679 | 24.34% | 37.36% | 13.02 | $410 | $485 | $75 | $14,760 | $17,445 | $2,685 |
| 680 to 719 | 22.00% | 33.88% | 11.88 | $397 | $464 | $67 | $14,303 | $16,705 | $2,402 |
| 720 to 759 | 18.30% | 29.86% | 11.56 | $378 | $441 | $63 | $13,596 | $15,870 | $2,274 |
| 760+ | 14.46% | 27.10% | 12.64 | $358 | $425 | $67 | $12,884 | $15,309 | $2,426 |
| All | 21.43% | 33.90% | 12.47 | $394 | $464 | $70 | $14,192 | $16,709 | $2,516 |
Source: LendingTree analysis of personal loan offers on the LendingTree platform in February 2024. Note: While we rounded for display, calculations were made with unrounded figures.
The maximum payment over three years for those who received three or more offers was $16,709 on average. When compared to the average closed personal loan of $10,403 on the LendingTree platform, that’s a difference of $6,306. But shopping around could save consumers up to 39.9% on interest owed throughout the loan term.
Those with lower scores have higher potential savings with three or more offers. Those with three or more offers and a fair or good credit score between 640 and 679 could save an average of $2,685 by shopping around. The lowest average APR offered to this group was 24.34%, while the highest was 37.36% — a 13.02 percentage point difference. That translates to an average minimum monthly payment of $410 and a maximum monthly payment of $485, meaning consumers with these scores could save $75 a month.
Borrowers with 6 or more offers have the highest potential savings
Three offers aren’t where the savings end. Across February 2024, the median number of offers loan shoppers got on the LendingTree platform was six — and savings for this group are even higher.
Across all credit scores, consumers with six or more offers could save $2,731 on a three-year personal loan. While the minimum APR offered was 19.50%, the maximum was 33.16% — a 13.66 percentage point difference. That translates to a minimum monthly payment of $384 and a maximum monthly payment of $460 — or $76 a month in savings.
How much consumers with 6 or more offers could save on average by shopping around for a personal loan
| Credit score range | Average APR offers | Monthly payments | Total payments, 3 years | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Minimum | Maximum | Spread | Minimum | Maximum | Spread | Minimum | Maximum | Spread | |
| 640 to 679 | 22.72% | 37.99% | 15.27 | $401 | $488 | $87 | $14,443 | $17,581 | $3,138 |
| 680 to 719 | 20.92% | 33.75% | 12.83 | $392 | $463 | $72 | $14,094 | $16,677 | $2,583 |
| 720 to 759 | 17.79% | 30.03% | 12.24 | $375 | $442 | $67 | $13,500 | $15,905 | $2,405 |
| 760+ | 14.27% | 27.50% | 13.23 | $357 | $428 | $71 | $12,849 | $15,390 | $2,541 |
| All | 19.50% | 33.16% | 13.66 | $384 | $460 | $76 | $13,823 | $16,554 | $2,731 |
Source: LendingTree analysis of personal loan offers on the LendingTree platform in February 2024. Note: While we rounded for display, calculations were made with unrounded figures.
The maximum payment over three years was $16,554. With the average closed loan amount of $10,403, that’s a difference of $6,151. However, borrowers could save up to 44.4% on total interest owed throughout the loan term.
Once again, the highest savings are for those with a good or fair credit score between 640 and 679, at $3,138 — the highest in our study. Among this group, the average minimum APR offered was 22.72%, while the maximum was 37.99%. That’s a 15.27 percentage point difference — the highest spread, thus the highest potential savings.
Shopping around for a personal loan: Top expert tips
While shopping around could translate to great savings, you may not know where to start. Schulz offers the following advice:
- Consider approaching a lender with which you already have a relationship. “The bank that you’ve had a checking and savings account with for years knows more about you than other lenders might, so they might be willing to give you a better deal on that next loan,” he says. “It won’t always work, but it can be a good option, especially if you’re just starting with credit.”
- Improve your credit. “Sure, easier said than done, right?” Schulz says. “Maybe, but the truth is that better credit means better chances to get loans and better terms when you get the loan. Ideally, you’d do this by paying off other balances, but that’s not always possible. Other options could include asking a credit card issuer for a higher credit limit to improve your utilization or checking your credit report to remove any errors that might hold down your score unnecessarily.”
Methodology
Average offered APRs were calculated for consumers who sought a personal loan in February 2024 on the LendingTree platform, where users can receive loan offers from multiple lenders. The analyst also determined the average APRs for consumers who received three or more and six or more offers.
The loan amount represents the average amount received by personal loan borrowers who closed their loans between Feb. 1, 2024, and Feb. 29, 2024, on the LendingTree platform.