A 5% APR is good for pretty much all types of borrowing, except for mortgages. On personal loans, credit cards, student loans, and auto loans, 5% is much cheaper than the average rate. You probably won’t be able to get a rate this low unless you have excellent credit, though – and it’s unlikely to even be offered in the case of credit cards.
5% Is a Good APR For:
Credit cards
A 5% APR is very good for a credit card. You’re unlikely to find an ongoing rate this low, though. The average credit card APR is 22.89%.
Personal loans
A 5% APR is very good for a personal loan. APRs on personal loans tend to range from around 4% to 36%.
Auto loans
A 5% APR is very good for auto loans. APRs on auto loans tend to range from around 4% to 10%, depending on whether you buy new or used.
5% Is NOT a Good APR For:
Mortgages
A 5% APR is not great for a mortgage. The average 30-year fixed mortgage rate is around 3%.
Student loans
A 5% APR is not great for federal student loans, which tend to have rates from around 3% to 5%. It’s decent for private student loans, whose rates range from 1% to 12%.
This answer was last updated on 03/26/24 and it was first published on 05/13/21. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
