Personal loans can be a versatile and flexible way to borrow money. Typically, when you take out a personal loan, the lender just deposits the money in your checking account. You can do whatever you want with it once you have it.
Of course, you will have to pay back all you borrowed. So, before you move forward with taking out a personal loan, you'll need to consider the monthly costs you'll incur. If you are thinking about a $10,000 personal loan, here's what you can expect.
Here's the monthly payment if you borrow $10,000
There's not just one answer to the question of how much a monthly payment on a $10,000 personal loan will be because there are actually two factors that impact it:
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- Your interest rate
- The repayment timeline
For example, the table below shows what your monthly payments would be at different interest rates with different repayment terms if you borrowed $10,000. It also shows total interest costs over time. This includes an 11.48% rate, which is the national average for personal loan rates as of July 10, 2023 according to the Federal Reserve.
| Interest Rate | 2-Year Repayment Timeline | 5-Year Repayment Timeline | 7-Year Repayment Timeline |
|---|
| 7.00% | $448 per month, $745.42 in total interest | $198 per month, $1,880.72 in total interest | $151 per month, $2,677.85 in total interest |
| 11.48% | $468 per month, $1,239.44 in total interest | $220 per month,$3,189.54 in total interest | $174 per month, $4,595.72 in total interest |
| 15.00% | $485 per month, $1,636.80 in total interest | $238 per month, $4,273.96 in total interest | $193 per month, $6,209.27 in total interest |
Data source: Author calculations using personal loan calculator.
As you can see, there's a huge difference in monthly payment costs and total costs based on your interest rate as well as the time it takes you to repay your loan.
And there's a tradeoff to be made. If you want lower monthly payments, you're going to have to accept higher costs over time. If you would prefer to be debt free sooner and pay less over time, you'll have to pay more each month.
Keeping your borrowing costs down is often the best approach
When it comes to taking out a personal loan, your goal should typically be to find a loan that provides the lowest total borrowing costs over time while still being affordable.
You don't want to make your payment so high that you risk defaulting. But you should choose the loan with the shortest payoff timeline that you can comfortably afford. This way you can become debt free faster. Plus keeping borrowing costs down means you send less money to the lender and keep more in your pocket. So, take a close look at your budget. If you can make a higher payment work without unsustainable sacrifice, choose the loan with the shorter payoff time.
Aside from picking a shorter loan term, you'll also want to do all you can to get a loan at the lowest possible interest rate. This can make a huge impact on your payments without any downsides. To get the best rate, you can:
- Shop around among different lenders. Get online quotes from banks, credit unions, and online lenders to see which offers you the most affordable loan. You'll need to input some basic information about how much you want to borrow and even your Social Security number, but many lenders will give you a quote without a hard credit check so you can compare your options. Try to get quotes from at least three lenders so you can get a good idea of what rates are available to you.
- Try to improve your credit before borrowing. Making extra monthly payments to reduce other debts can help you do that. You can free up the funds to do so by giving up a meal or two out for a few months or picking up a side gig for a few hours a week. Or you can try writing a goodwill letter to ask creditors to voluntarily remove negative information from your credit record.
- Consider a cosigner. If someone with better credit or more income will agree to share legal responsibility for your personal loan, you can often get a better rate.
If you take these steps, ideally your $10,000 personal loan will be affordable for you both monthly and over time.
Our picks for the best personal loans
Our team of independent experts pored over the fine print to find the select personal loans that offer competitive rates and low fees. Get started by reviewing our picks for the best personal loans.
FAQs
Representative Example
Representative 6.1% APR, based on a loan amount of £10,000, over 5 years, at a Fixed Annual Interest Rate of 5.9358%, (nominal). This would give you a monthly repayment of £193.02 and a total amount repayable of £11,581.20.
What would payments be on a $10,000 personal loan? ›
Here's how much you'd pay each month for a $10,000 personal loan
| 8.00% | 12.35% |
|---|
| Five-Year Repayment | $202.76/month, $2,165.84 in interest over time | $224.22/month, $3,453.03 in interest over time |
| Seven-Year Repayment | $155.86/month, $3,092.42 in interest over time | $178.40/month, $4,985.98 in interest over time |
1 more rowJan 17, 2024
Representative Example
Representative 6.1% APR, based on a loan amount of £10,000, over 5 years, at a Fixed Annual Interest Rate of 5.9358%, (nominal). This would give you a monthly repayment of £193.02 and a total amount repayable of £11,581.20.
How is the monthly payment calculated for a 10000? ›
If you borrow $10,000 and take 75 months to repay it (with a 5.50% interest rate), your monthly payment will be $157.14. Interest, or the cost of borrowing money, also affects the monthly payment. Calculating this is a bit more complicated than dividing the loan's principal by the number of months you have to repay it.
What credit score do I need for a $10000 personal loan? ›
To increase your chance of qualifying for a $10,000 unsecured loan, you should have a credit score of 600 or higher. Some lenders start their minimum credit score requirements at 600, however, there are some lenders that require a credit score in the high 600s or low 700s.
How hard is it to get a $10,000 dollar loan? ›
The main factor in determining if you qualify for a $10,000 personal loan is your credit history. You'll need a credit score of at least 670 before you apply. Lenders look at your debt-to-income ratio when deciding approval. A DTI ratio of 36% or lower is ideal.
Is $10000 considered a small loan? ›
Key takeaways:
And small loans generally range from $1,000 to $10,000 and can generally be obtained with lower interest rates than credit cards. Borrowers should shop around for lenders that offer loans in the size they need and understand the fees associated with taking out a loan.
How much would a $100000 loan cost per month? ›
Monthly payments for a $100,000 mortgage
| Annual Percentage Rate (APR) | Monthly payment (15-year) | Monthly payment (30-year) |
|---|
| 7.00% | $898.83 | $665.30 |
| 7.25% | $912.86 | $682.18 |
| 7.50% | $927.01 | $699.21 |
| 7.75% | $941.28 | $716.41 |
5 more rowsCurrent Interest Rate on Personal Loans
| Bank | Interest Rate (p.a.) | Processing Fee |
|---|
| HDFC Bank | 10.75% p.a. - 24.00% p.a. | Rs.4,999 + GST |
| ICICI Bank | 10.80% p.a. - 16.15% p.a. | Up to 2% |
| TurboLoan Powered by Chola | 14% p.a. | 4% - 6% |
| Yes Bank | 10.99% p.a. onwards - 20% p.a. | Up to 2.5% |
26 more rowsPersonal Loan Calculator
| $5,000 | $9,000 |
|---|
| 24 mos. | $267 | $480 |
| 36 mos. | $199 | $358 |
| 48 mos. | $166 | $298 |
| 60 mos. | $147 | $264 |
1% of the balance plus interest: It would take 29.5 years or 354 months to pay off $10,000 in credit card debt making only minimum payments.
How to figure out monthly payment on a loan? ›
The formula is: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1], where M is the monthly payment, P is the loan amount, i is the interest rate (divided by 12) and n is the number of monthly payments.
How much is a monthly payment on a $8000 loan? ›
The monthly payment on an $8,000 loan ranges from $109 to $804, depending on the APR and how long the loan lasts. For example, if you take out an $8,000 loan for one year with an APR of 36%, your monthly payment will be $804.
What's the average payment on a $10000 personal loan? ›
The monthly payment on a $10,000 loan ranges from $137 to $1,005, depending on the APR and how long the loan lasts. For example, if you take out a $10,000 loan for one year with an APR of 36%, your monthly payment will be $1,005.
Who is the easiest to get a personal loan from? ›
Easiest-to-get personal loans compared 2024
| Title | APR | Min. credit score |
|---|
| BadCreditLoans.com | 5.99% to 35.99% | Undisclosed |
| Upstart | 5.2% to 35.99% | 300 |
| Avant | 9.95% to 35.99% | 580 |
| LendingClub | 8.98% to 35.99% | 600 |
6 more rowsMay 7, 2024
A personal loan will cause a slight hit to your credit score in the short term, but making on-time payments will bring it back up and can help improve your credit in the long run. A personal loan calculator can be a big help when it comes to determining the loan repayment term that's right for you.
How much loan can I get on $50 000 salary? ›
The rule of 2.5 times your income stipulates that you shouldn't purchase a house that costs more than two and a half times your annual income. So, if you have a $50,000 annual salary, you should be able to afford a $125,000 home. Explore what your mortgage payment might be with today's rates.
How much would a $8000 loan cost per month? ›
Example Monthly Payments on an $8,000 Personal Loan
| Payoff period | APR | Monthly payment |
|---|
| 12 months | 15% | $722 |
| 24 months | 15% | $388 |
| 36 months | 15% | $277 |
| 48 months | 15% | $223 |
3 more rowsAug 31, 2021
Nearly 23 million Americans have unsecured personal loans, with an average balance of about $11,500. Today, the average interest rate on a personal loan is 11.48%, up from 9.38% in 2021. The average personal loan balance is highest among baby boomers ($21,644) and lowest among Generation Z ($7,684).
What will you have paid if you borrow $10000 over five years at the end of the five years? ›
For a quick example, consider a $10,000 loan at 5% interest repaid over five years. As established above, a loan this size would total $12,500 after five years.
