Why are so many people looking for personal loans right now?
Americans are carrying record levels of card debt and facing higher borrowing costs at the same time. Credit card balances stand at $1.263 trillion as of Q2 2026, and the Federal Reserve raised its benchmark rate to 3.75% to 4% on September 16, making new card debt more expensive.1, 3
Personal loan balances have also grown, reaching $281 billion across 26.9 million borrowers as of Q2 2026, a 9.3% rise from a year earlier.3 More than half of borrowers, 52.4%, take out a personal loan to consolidate debt or refinance credit cards, and paying everyday bills is the second most common reason at 8.5%.3 The delinquency rate for personal loans has risen too, to 3.81% for borrowers 60 days or more past due, up from 3.37% a year earlier, a sign that more households are under financial pressure.3
Why did the Fed raise interest rates in September 2026?
The Fed raised rates because inflation remains above its 2% target. The FOMC voted 12-0 to increase the federal funds rate by a quarter point, citing elevated inflation and a resilient economy.1 According to CNBC, Chairman Kevin Warsh said inflation had been "too high ... for too long" and that the committee was not yet confident that underlying inflation was moving toward its objective "clearly and at sufficient speed."2
CNBC reported that the decision was also influenced by tension in the Middle East, which contributed to spiraling oil prices, and that Warsh cited the strong labor market as a further reason for acting.2 Updated projections showed that 16 of 18 officials expected at least one more rate increase, though no further hikes are penciled in beyond this year.2 The worry, according to CNBC, is that prolonged energy price rises could lift inflation expectations more broadly, with economists also flagging expanded investment in artificial intelligence as a potential inflationary factor.2
Can AI be used to help me get a loan?
AI tools are used on the lender side to speed up decisions, but they are not a direct route to getting a loan for borrowers. Lenders using AI-powered platforms can automate application intake, identity verification, and underwriting by analyzing bank data, income patterns, and credit behavior, which can result in faster approvals for applicants.5
For borrowers, the practical benefit is a quicker process and more consistent decisions. Comparison marketplaces such as those reviewed by Money allow applicants to prequalify with a soft credit pull and receive multiple offers without affecting their credit score, which is a separate use of technology from AI underwriting.4 Whether Upgrade personal loans, LightStream personal loans, or another lender approves a given application still depends on the borrower's credit profile, income, and the lender's own criteria, not on which brands AI chatbots mention most often.