Personal loan debt reached a new record in 2026. According to LendingTree’s 2026 personal loan statistics, Americans owed $277 billion in personal loan debt as of the first quarter — the highest level in more than two decades of available data, and a 9.5% increase from the same period in 2025. More than half of borrowers, 53.1%, take out a personal loan specifically to consolidate debt or refinance credit card balances.

The rate gap driving the surge

The math behind the trend is straightforward: average credit card APRs for accounts carrying a balance sat at 22.15% in the second quarter of 2026, while the best personal loan rates — available to borrowers with FICO scores of 720 and above — started around 6.2% as of July. That gap of roughly 16 percentage points makes consolidating high-interest credit card debt into a lower-rate personal loan a genuinely large potential saving for qualifying borrowers, not just a marginal improvement.

Where consolidation commonly goes wrong

Industry coverage of the trend flags a specific, well-documented failure mode: consolidating credit card balances into a personal loan without closing or freezing the newly-paid-off cards. Borrowers who keep spending on those cards after consolidating often end up with both the new personal loan balance and a fresh round of credit card debt within six months — worse off than before consolidating, not better.

Run your own numbers before consolidating

Our loan calculator shows your monthly payment and total interest for a proposed consolidation loan, making it easy to compare directly against what you’re currently paying across higher-rate credit card balances.