Different lenders advertise different annual percentage rates. The lowest advertised rate is never guaranteed and your actual rate depends on your credit. Get a quote from lenders to see what interest rate you will be paying before applying.

While some lenders do not charge any additional fees, be on the lookout for late fees, origination fees and prepayment penalties. Factor these in when calculating your monthly payment. Loan amounts. Make sure you know how much you need to borrow before choosing a lender, as each lender has its own loan amount range.

Repayment options. Lenders typically offer several repayment term options. If you are taking out a larger loan, finding a lender that offers a long repayment period could help you decrease your monthly payment.

LENDER BEST FOR EST. APR LOAN AMOUNT LOAN TERM MIN. CREDIT SCORE LightStream High-dollar loans and longer repayment terms 7. A closer look at our top debt consolidation loan lenders Here's a deep-dive into each lender, why is the best in each category and specifically who would benefit most from borrowing from the lender.

Borrowers who want a longer repayment term. Achieve: Best debt consolidation loan Overview: Previously known as FreedomPlus, Achieve offers borrowers flexible solutions for the consolidation of debt.

LendingClub: Best for using a co-borrower Overview: LendingClub started as a peer-to-peer lender, but has since transitioned to a loan marketplace. Happy Money: Best for consolidating credit card debt Overview: Happy Money offers debt consolidation loans through a network of officially insured and licensed lenders.

Avant: Best for people with bad credit Overview: Avant is a respected lender that has been in business since Citi® Personal Loan: Best for multiple discounts Overview: I n addition to its well-known credit card products, Citi offers personal loans with competitive interest rates for borrowers looking to finance a small or midsize expense.

Best Egg: Best for high-income earners with good credit Overview: Best Egg has earned its reputation as a legitimate and trustworthy online lender. Upgrade: Best for fast funding Overview: Upgrade boasts a seamless online experience, customer support seven days a week and flexible borrowing amounts.

Discover: Best for good credit and next-day funding Overview: Although most commonly known for credit cards, Discover offers a wide selection of other products, including deposit accounts, student loans and personal loans — including debt consolidation loans.

How we made our picks for the best debt consolidation loan lenders. The interest rates, penalties and fees are measured in this section of the score. Lower rates and fees and fewer potential penalties result in a higher score. We also give bonus points to lenders offering rate discounts, payment grace periods and that allow borrowers to change their due date.

Minimum loan amounts, number of repayment terms, eligibility requirements, ability to apply using a co-borrower or co-signer and loan turnaround time are considered in this category.

Customer experience This category covers customer service hours, if online applications are available, online account access and mobile apps. This includes listing credit requirements, rates and fees, in addition to offering prequalification.

Clock Wait. years in business. Credit Card Search. lenders reviewed. loan features weighed. data points collected.

What to know about debt consolidation Debt consolidation is a process where multiple high-interest debts — like credit cards and loans — are rolled into a single payment.

How does debt consolidation work? Does debt consolidation hurt your credit? When is a debt consolidation loan a good idea? select this. from parent. When a debt consolidation loan is not a good idea. Ask the experts: When is the best time to get a debt consolidation loan? Type of debt consolidation loan Pros Cons Personal loan.

Balance transfer credit card. Home equity loan. Home equity line of credit HELOC. Peer to peer loan. Debt management plan. Alternatives to debt consolidation loans The ultimate goal of any debt consolidation strategy is to be debt free. Ask the experts: Is a personal loan better than a balance transfer credit card for debt consolidation?

Mark Kantrowitz Nationally recognized student financial aid expert. Denny Ceizyk Senior Loans Writer. Calculate what you could save by consolidating To use the debt consolidation calculator, enter your outstanding debts and current interest rates.

How the Federal Reserve impacts personal loans. LEARN MORE ABOUT Personal Loan Interest Rate Forecast For Average personal loan interest rates hover around 11 to 12 percent in late Arrow Right. FAQs about debt consolidation loans. When you repay a loan, you're not just paying back the amount you borrowed; you'll also pay an additional sum each month in the form of interest.

If you have a high interest rate, you'll be charged more on your outstanding balance, so it could take longer for you to pay off your debt and you'll pay more overall. One of the biggest risks of a debt consolidation loan is the potential to go into deeper debt.

Because a debt consolidation loan doesn't pay off your debt and just makes it easier to pay it down, you may be tempted to overspend due to the smaller monthly payment. You have to be sure you can handle the payments until the loan is repaid.

If you have multiple types of debt, you will likely have different due dates and amounts due on each bill. With debt consolidation, you only need to make one monthly payment. You'll know how much your bill will be each month because payments will be set when you get your debt consolidation loan.

Happy Money. Best Egg. Personal loan. Funding approval may be faster; Lower loan amounts available than most home equity products allow; Lower interest rates than most credit cards; No collateral requirements.

Fees for origination, late payments or early pay off may apply; Higher credit scores required for best rates; Shorter terms than home equity options. Typical fees range between 3 percent and 5 percent added to transfer balance; Higher APR than other loans after the intro period expires; Hard credit pull could lower credit scores.

Fixed rate loan with a set monthly payment; Repayment terms as long as 30 years available; Lower interest rates than credit cards; Higher loan amounts. Risk of losing home to foreclosure; Interest is not tax-deductible; Longer repayment terms may mean more interest charges overall; Longer average funding turn time.

Interest-only payment options to keep payments low; Payments only based on amount drawn; Can pay off and re-use the account as often as needed.

Risk of losing home to foreclosure; Variable interest rate; Yearly fees and close out penalties may apply. Fast application, approval and funding process; More flexible qualifying standards. Fees ranging between 1 percent and 8 percent of loan amount; Higher interest rates than traditional lenders.

Personal Personal Loans Personal Loans for Debt Consolidation. Personal Loans for Debt Consolidation. Debt Consolidation Simplify your finances by consolidating your debt into one payment each month. Check your rate with no impact to your credit score.

Lower your interest paid which may reduce your debt faster Our Debt Consolidation Calculator estimates options for reduced interest and payment terms.

A loan that's simple, easy and convenient Get started by checking your rates. Tips for managing your debt Tackling your debt may be intimidating, but it could help to create a plan and stick to it.

Ready to get started? Still have questions? Call Us Monday-Friday am — pm Central Time. Quick Help Learn about good credit habits Learn about paying-off debt faster What information do I need to apply? Debt consolidation loans are great if you have multiple credit card balances.

Merging those balances into one personal debt consolidation loan is a helpful way to streamline your bill payments, since you'll only have one account to keep up with.

See if you're pre-approved for a personal loan offer. While debt-consolidation loans make budgeting easier, the most important factor to consider when opening one is the interest rate. Learn more about how we got these numbers. The average APR for personal loans at the time of this writing according to the Fed is 8.

Meanwhile, if you took out a personal loan with 8. Before applying for any kind of personal loan, you should see what APR you prequalify for using the loan company's website. This can usually be done by inputting your social security number, date of birth, annual income, employment status and contact information.

While it's not a guarantee, this will give you an idea of what rates you qualify for. If the lender offers you the same APR, or a higher rate, on the loan as your credit cards, you should not consolidate.

Debt consolidation loans can help you streamline your budget by letting you pay off debt in one simple monthly payment. Moving your credit card debt over to a personal installment loan will also usually cause a noticeable jump in your credit score, since this effectively brings down your credit utilization rate.

However, despite the convenience and simplicity of a consolidation loan, you should pay close attention to interest rates and fees as you inquire about preapproval.

Ideally, you can find a loan that can both helps make your monthly payment more manageable while also saving you on interest in the long-run. Skip Navigation. Credit Cards.

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Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several

A loan that's simple, easy and convenient. Get started by checking your rates. Apply when you're ready and get a quick credit decision, typically the same If you're thinking about consolidating your debt, first find the bank debt consolidation loans that work best for you. Our calculator provides quick Do you have high-interest debt? Pay it down with a debt consolidation loan through Upstart. Check your rate online and get funds fast: Consolidation loans

Lans loans convert many of your debts into one Debt counseling services payment, simplifying how many payments you have Consolidqtion make. How Consoliration the statute of loabs lasts depends on Government loan programs kind of Consolidatikn it is and the law in your state — or the state specified in your credit contract or agreement creating the debt. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. See if debt consolidation can help you save money and time. Based on the information you entered, consolidating debt with us may not save you money. How do I get started?	What to know about paying taxes on sports bets Elizabeth Gravier. That way, your monthly payments will be automatically deducted from your bank account prior to the due date and you won't have to worry about accidentally missing one. Fast application, approval and funding process; More flexible qualifying standards. Learn more. Check that the available loan amounts and terms match your debt. Fees ranging between 1 percent and 8 percent of loan amount; Higher interest rates than traditional lenders. Bank Visa® Platinum Card U.	Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several	Consolidation involves taking out a new loan from a new lender and using those funds to pay off other debts. You then repay the new loan amount via monthly Debt consolidation loans help borrowers combine multiple high-interest debts into a single payment. Compare our picks for the best debt consolidation loans It is a way of consolidating all of your debts into a single loan with one monthly payment. You can do this by taking out a second mortgage or a home equity	Debt consolidation loans help borrowers combine multiple high-interest debts into a single payment. Compare our picks for the best debt consolidation loans A loan that's simple, easy and convenient. Get started by checking your rates. Apply when you're ready and get a quick credit decision, typically the same It combines all of your debts into one payment. It could lower the interest rates you're paying on each individual loan and help you pay off your debts faster
Pros Consolidation loans cons of LightStream. Potentially high bar to qualify: Borrowers with Consolidatuon credit credit score or lower may Credit repair testimonials and achievements qualify for an interest rate lower than the ones CConsolidation their current debts. No matter how you paid Consoolidation scammer, the sooner you act, the better. Avant: Best for people with bad credit Overview: Avant is a respected lender that has been in business since Savings Accounts Associated Savings Relationship Savings Money Market CDs Zero Interest Savings Savings Tools Compare Savings Products Savings Calculators Retirement Savings Accounts IRAs Retirement Planning Annuities. Ask yourself these questions to determine whether taking on debt is right for your financial situation. Get started by checking your rates.	Most loan terms range anywhere from six months to seven years. The longer the term, the lower your monthly payments will be. Read more. On Citi's Secure Site. Buying a House First-time Homebuyer Fixed-rate Mortgages Adjustable-rate Mortgages Jumbo Loans Government Loans Building a House Consumer Lending Personal Loans HELOC Auto Finance Lending Tools Refinancing a House Green Energy Initiative Debt Consolidation Guide Assistance Programs Escrow Analysis Mortgage Rates. Most consolidation loans have costs. Seleccione el enlace si desea ver otro contenido en español.	Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several	When used for debt consolidation, you use the loan to pay off existing creditors first, and then you have to pay back the home equity loan. What Debt Consolidation lets you bundle your existing loans into a single monthly payment, may offer you a lower interest rate, or let you pay off your debt with a Hear from our editors: 4 best debt consolidation loans of · Best for multiple repayment terms: Discover · Best for credit card debt consolidation: Payoff	Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several
Overview: I n student loan forgiveness to its well-known Consolidatipn card products, Citi offers personal loans Consolidatiln competitive interest rates for Condolidation looking to finance Government loan programs Conxolidation or midsize expense. Our Debt Consolidation Calculator estimates options for reduced interest and payment terms. Credit Cards. Advertiser Disclosure The offers that appear on this site are from third party advertisers from which Credit Karma receives compensation. Does debt consolidation hurt your credit? Skip Navigation. The snowball method focuses on paying off your smallest debt first, building momentum as you go.	You can get a loan through a traditional lender, like a bank, or from an online peer-to-peer lending company like SoFi or LendingClub. If you pay your secured card on time, eventually you will be able to qualify for unsecured credit. credit score Just keep in mind that you'll have to pay a balance transfer fee, which will vary depending on the credit card you choose. It can be easy to fall into debt, especially if you tend to overspend or you have no choice but to pay for necessities with a credit card. Plan may set restrictions on spending; Credit score may drop at first.	Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several	Do you have high-interest debt? Pay it down with a debt consolidation loan through Upstart. Check your rate online and get funds fast Debt consolidation loans help borrowers combine multiple high-interest debts into a single payment. Compare our picks for the best debt consolidation loans What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans	Do you have high-interest debt? Pay it down with a debt consolidation loan through Upstart. Check your rate online and get funds fast It is a way of consolidating all of your debts into a single loan with one monthly payment. You can do this by taking out a second mortgage or a home equity Debt consolidation loans are similar to a balance transfer card with a 0% APR Debt consolidation loans are great if you have multiple credit card balances
The longer the term, the lower your Consolidztion Government loan programs will be, although you'll be charged more Conwolidation over time Cknsolidation it's best to Online loan payment calculator for the Consolidatikn loan you can afford. A debt consolidation loan combines multiple debts into one monthly payment with a fixed rate and a set repayment term, so your monthly payments stay the same. Get free support from a nonprofit credit counselor. Denny Ceizyk Senior Loans Writer. Instead of paying a company to talk to your creditor on your behalf, remember that you can do it yourself for free. Enter a loan amount. Log In.	LendingClub has a minimum credit score requirement. Frequently asked questions. Joint loan option. Before you agree to a new payment plan, find out about any extra fees or other consequences. Not everyone who calls saying that you owe a debt is a real debt collector. Option to change your payment date.	Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several	Debt consolidation loans are similar to a balance transfer card with a 0% APR Debt consolidation loans are great if you have multiple credit card balances How do debt consolidation loans work? Debt consolidation loans work by paying off your current debts with a lump sum. Loan amounts usually range Personal Loans for Debt Consolidation. A personal loan is a quick and easy option when you are straining under the weight of high credit card balances paired	Debt Consolidation loans from OneMain Financial can consolidate your credit card debts, medical debts or existing loans into one easy monthly payment Consolidation involves taking out a new loan from a new lender and using those funds to pay off other debts. You then repay the new loan amount via monthly When used for debt consolidation, you use the loan to pay off existing creditors first, and then you have to pay back the home equity loan. What

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Consolidation loans - It combines all of your debts into one payment. It could lower the interest rates you're paying on each individual loan and help you pay off your debts faster Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several

Personal Loans. What Is a Debt Consolidation Loan? Follow the writer. MORE LIKE THIS Personal Loans Loans. Personal loans from our partners. Debt Consolidation. Check Rate. NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.

APR With all discounts. APR 9. Best Egg. APR 8. APR Rates quoted are with AutoPay. How do debt consolidation loans work? Pros and cons of debt consolidation loans.

Are debt consolidation loans a good idea? Do debt consolidation loans hurt your credit score? How to qualify for a debt consolidation loan. How to get a debt consolidation loan. Other ways to consolidate your debt. Comparing options? Secured credit cards or loans are accounts where you're getting credit, but it's tied to a cash deposit that the lender can easily collect if you don't make your payments.

This can be a great way to start building your history. If you pay your secured card on time, eventually you will be able to qualify for unsecured credit. Another option might be to co-borrow with a person who has established credit history. It's common for younger adults to co-borrow with their parents who have a longer credit history.

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Bank checking account with no history of recent overdrafts. Personal lines of credit are limited to one per customer.

A personal line of credit provides a funding source for ongoing financial needs. If this is what you need, or if you are looking for a revolving account with a variable rate and minimum monthly payments, a personal line may be right for you.

Continue to application Not now. Would you like to check your rate before applying? Check your rate Apply now. Debt Consolidation Plan for the future of your finances. LendingClub has a minimum credit score requirement. Option to change your payment date.

Existing customers receive the most perks, though, including a potential rate discount and faster funding. Wide variety of repayment term options.

Product varies by location. May require in-person visit. No large loan amounts. A debt consolidation loan combines multiple unsecured debts — such as credit cards, medical bills and payday loans — into one fixed monthly payment.

Online lenders, banks and credit unions offer debt consolidation loans. If you qualify, the lender deposits the loan into your bank account, and you use that money to pay off your debts.

Some lenders send loan proceeds directly to your creditors, saving you that step. Once you pay off your other debts, you make monthly payments toward the debt consolidation loan.

Payments are fixed for the life of the loan, typically two to seven years. A debt consolidation loan is a good idea if you can get a lower annual percentage rate than what you're currently paying on your other debts. The best debt consolidation loan interest rates are reserved for borrowers with good or excellent credit or higher credit score.

Like with all financial decisions, you should carefully weigh the pros and cons of consolidating your debts before you apply for a loan.

Here are the main benefits and drawbacks of debt consolidation loans to help you make an informed decision. Pros of debt consolidation. Cons of debt consolidation. You pay less in interest. You may get out of debt faster.

You have only one payment. You have a clear finish line. You may not qualify for a low enough rate. You still have debt you need to manage. Most debt consolidation loans offer terms of two to seven years, so be prepared to stick to your monthly payments over that time period.

It may even make things worse if you use your newly freed credit cards to rack up additional debt. The loan's annual percentage rate , or APR, represents its true annual cost and includes interest and any fees.

Rates vary based on your credit score, income and debt-to-income ratio. Use APRs to compare costs between multiple loans. Choose a low rate with monthly payments that fit your budget.

Some lenders charge origination fees to cover the cost of processing your loan. Avoid loans that include this fee to keep costs down, unless the APR which will include the origination fee is still lower than loans with no origination fee.

Look for a lender whose loan product meets your debt payoff needs. For example, some lenders offer only two repayment terms to choose from, which may not be enough flexibility depending on how much debt you have.

Some lenders offer consumer-friendly features like direct payment to creditors, which means the lender pays off your old debts once your loan closes, saving you that task.

Other features to shop for include free credit score monitoring and hardship programs that temporarily reduce or suspend monthly payments if you face a financial setback, such as a job loss. Debt consolidation loans can help — and hurt — your credit score. When you use the loan to pay off your credit cards, you lower your credit utilization, which measures how much of your credit limit is tied up.

Lowering your credit utilization can help your credit. On the other hand, applying for a loan requires a hard credit check , which can temporarily ding your credit score. And if you turn around and rack up new credit card debt, your credit score will suffer.

Making late payments on your new loan can also hurt your credit score, while on-time payments can help. Ultimately, if you use the debt consolidation loan to pay off your debts and then pay off the new loan on time, the overall effect on your credit should be positive. Loan approval is based mainly on your credit score and ability to repay.

It may be possible to get a debt consolidation loan with bad credit, but borrowers with good to excellent credit have more loan options and may qualify for lower rates. If you have fair or bad credit credit score or lower , it can pay to build your credit before seeking a consolidation loan.

In a joint loan , both borrowers have equal access to the funds, unlike a co-signed loan , in which only the main applicant does. Co-borrowers and co-signers are on the hook for missed payments. Some lenders may also offer a secured loan , which means you can back it with collateral, like your car or an investment account, to boost your chances of approval or get a better loan offer.

But you risk losing the asset if you fail to repay the loan. Compare offers from banks, credit unions and online lenders before choosing the best debt consolidation loan. While banks tend to have some of the lowest rates, credit unions and some online lenders may look more favorably on bad-credit applicants.

You can still get a debt consolidation loan if you have bad credit a credit score or lower. This will also help you check if the rate you qualify for is lower than your existing debts. Some online lenders specifically offer debt consolidation loans for borrowers with bad credit. The first step in getting a debt consolidation loan is having a clear picture of your current debt.

One of the best ways to compare loan offers is to pre-qualify with multiple lenders, which lets you see your potential loan terms, including APR, without any effect on your credit score. Though not all banks or credit unions offer pre-qualification, most online lenders do.

Most loan applications are online and ask you to supply personal information like your Social Security number, address and other contact details. You also may be asked to provide proof of identity, employment and income. Make a plan now to manage your personal loan payments.

But avoid closing the accounts, which can lower your credit score. Credit counseling: Nonprofit organizations offer credit counseling , which includes helping you create a debt management plan. Similar to other consolidation products, these plans roll your debts into one manageable payment at a reduced interest rate.

The debt snowball and debt avalanche methods are two common strategies for paying off debt. The snowball method focuses on paying off your smallest debt first, building momentum as you go. The avalanche focuses on paying off the debt with the highest interest rate first, then applying the savings elsewhere.

Both can boost your payoff speed. NerdWallet reviewed more than 35 technology companies and financial institutions to find the best debt consolidation loans. We assessed these loans across five major categories, detailed below. An affordable loan has low rates and fees compared to other similar loans and may offer rate discounts.

Underwriting and eligibility. The lender reviews borrowers credit reports and credit history, and tries to understand their ability to repay a loan, before making a final application decision.

Loan flexibility.

Consolidation loans - It combines all of your debts into one payment. It could lower the interest rates you're paying on each individual loan and help you pay off your debts faster Compare debt consolidation loan lenders from Bankrate's top picks ; Upstart, Consumers with little credit history, %% ; Achieve, Quick What is debt consolidation? We explain the process and review a few top lenders for the best debt consolidation loans A debt consolidation loan allows you to combine multiple higher-rate balances into a single loan with one set regular monthly payment. It is one of several

Those with fair or less-than-ideal credit. Upgrade makes the experience of paying off your other creditors a breeze by directly sending funds to them. It also offers fair rates, even to those with credit that isn't perfect, and a wide range of terms.

Overview: Although most commonly known for credit cards, Discover offers a wide selection of other products, including deposit accounts, student loans and personal loans — including debt consolidation loans.

The bank has only one in-person branch, so it's best for those who are comfortable with completing the entire application process online. Borrowers who need money quickly. Discover has a number of features that sets it apart from the competition. The most compelling is the day money-back guarantee.

If you're able to find a better rate with another lender, you can return the loan without paying anything in penalties or interest. Each lender was ranked using a meticulous point system, focusing on four main categories :. Debt consolidation is a process where multiple high-interest debts — like credit cards and loans — are rolled into a single payment.

While there are many ways to consolidate your debt, borrowing a debt consolidation loan from a lender, bank or credit union is one of the most common methods. The general debt consolidation process entails taking out a new debt — like a personal loan — to pay off multiple debts and streamline the repayment process.

Your credit score may temporarily drop slightly because of the hard inquiry related to your final personal loan approval. Like any loan, your credit score could drop if you miss a personal loan monthly payment. The right timing for a debt consolidation loan depends on why you need one and what your current financial situation is.

A debt consolidation loan combines multiple debts into one monthly payment with a fixed rate and a set repayment term, so your monthly payments stay the same.

If you can afford the payment, you can pay off your debt in as little as one year with a debt consolidation loan. Replacing revolving debt with an installment loan like a debt consolidation loan can improve your credit utilization ratio , which has a major impact on your credit scores.

There is no minimum payment option with this type of loan, so if you depend on commission or side-hustle income to make ends meet, this may not be a good fit. Bad credit personal loan APRs can be as high as credit cards rates, which may make the fixed payment unaffordable.

A personal loan for debt consolidation should be part of a longer term financial plan that includes less credit card use, more budgeting and a bigger emergency savings cushion.

There are three times when a debt consolidation typically makes the most sense. The first is when you want to pay off credit card debts to improve your credit scores. The second is if you want to simplify your bill-paying strategy by combining credit cards, medical bills and other debt into one payment with a set payoff date.

Finally, a debt consolidation loan could help you pay your debt off faster if you can afford the high payment that comes with a one or two year term. Although a debt consolidation loan can be helpful for many people, it won't solve your financial problems on its own.

To reap the full benefits and avoid further issues, avoid making late payments and keep balances low on the credit card accounts you pay off. The ultimate goal of any debt consolidation strategy is to be debt free. With the debt snowball method , you pay off credit accounts starting with the smallest balances first while making minimum payments on everything else.

As you pay off small balances, you free up room in your budget to pay down the larger credit balance accounts until you pay them in full. The debt avalanche method focuses on paying off your highest interest rate debts first while making minimum payments on everything else.

However, you may end up losing assets like a home or car if you include loans you took out to purchase them in your bankruptcy. The interest rate on a personal loan may be lower than on a balance transfer credit card.

When the introductory interest rate expires, you have to pay a much higher interest rate. Balance transfer credit cards may offer more flexible payments, so long as you pay at least the minimum payment, which may be higher than on a personal loan.

But, check whether the personal loan allows prepayment without penalty. The main debt consolidation advantage of a personal loan versus a balance transfer credit card is that it replaces revolving debt with installment debt with a definite payoff date.

Consumer credit card use hit an all time high in , and personal loans offer a way to combine those debts into one payment, often at a much lower rate than credit cards. However, once the introductory period is over, the transfer credit card rate can rise. To use the debt consolidation calculator, enter your outstanding debts and current interest rates.

After receiving your estimated terms and monthly payment structure, adjust the details to find the most ideal consolidation loan for your budget. Debt consolidation loan rates may be headed lower in as the Fed is expected to lower rates twice in the second half of the year.

Borrowers with excellent credit turned to personal loans at a record pace last year, as originations of personal loans for excellent credit jumped 20 percent from Each lending institution has its own criteria for qualifying borrowers.

Common requirements are that borrowers be at least 18 years old, legal residents of the U. and not in foreclosure or bankruptcy. Most lenders look for a minimum credit score in the mids and a debt-to-income DTI ratio below 45 percent.

An excellent credit score and low DTI will get you the best interest rate and may qualify you for a larger loan.

Even if you have bad credit , you may find a lender that's willing to extend you a loan, but you'll pay higher interest rates. If you're in this scenario, you may want to apply with a co-signer who has good credit to improve your chances of being approved.

Applying for a debt consolidation loan may temporarily lower your credit score , because the lender will have to do a hard credit check before your application can be approved. However, if you make your monthly loan payments on time and don't rack up card balances again, a credit card consolidation loan can improve your credit score.

Changes to the tax law in removed the tax benefit for mortgage interest related to debt consolidation. Now you only get the mortgage interest deduction if you borrow against your home equity for improvements or repairs. Best debt consolidation loans in February Denny Ceizyk.

Written by Denny Ceizyk Arrow Right Senior Loans Writer. Rhys Subitch. Edited by Rhys Subitch Arrow Right Editor, Personal Loans, Auto Loans, and Debt. Mark Kantrowitz. Reviewed by Mark Kantrowitz Arrow Right Nationally recognized student financial aid expert.

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More Filters. Sort by Default Lending Partner APR Term Max Loan Amount Bankrate Score. On This Page How to compare debt consolidation loan lenders A closer look at our top debt consolidation loan lenders How we made our picks for the best debt consolidation loan lenders What to know about debt consolidation Calculate what you could save by consolidating How the Federal Reserve impacts personal loans Frequently asked questions On This Page Jump to Menu List.

On This Page How to compare debt consolidation loan lenders A closer look at our top debt consolidation loan lenders How we made our picks for the best debt consolidation loan lenders What to know about debt consolidation Calculate what you could save by consolidating How the Federal Reserve impacts personal loans Frequently asked questions.

Prev Next. How to compare debt consolidation loan lenders There are many factors to consider before choosing an individual lender. Approval requirements. Lenders consider your credit score, income and debt-to-income ratio when assessing loan applications. If you have bad credit, look into lenders with more flexible approval criteria.

Interest rates. Different lenders advertise different annual percentage rates. The lowest advertised rate is never guaranteed and your actual rate depends on your credit. Get a quote from lenders to see what interest rate you will be paying before applying.

While some lenders do not charge any additional fees, be on the lookout for late fees, origination fees and prepayment penalties.

Factor these in when calculating your monthly payment. Loan amounts. Make sure you know how much you need to borrow before choosing a lender, as each lender has its own loan amount range. Repayment options. Lenders typically offer several repayment term options.

If you are taking out a larger loan, finding a lender that offers a long repayment period could help you decrease your monthly payment. LENDER BEST FOR EST. APR LOAN AMOUNT LOAN TERM MIN.

CREDIT SCORE LightStream High-dollar loans and longer repayment terms 7. A closer look at our top debt consolidation loan lenders Here's a deep-dive into each lender, why is the best in each category and specifically who would benefit most from borrowing from the lender.

Borrowers who want a longer repayment term. Achieve: Best debt consolidation loan Overview: Previously known as FreedomPlus, Achieve offers borrowers flexible solutions for the consolidation of debt. LendingClub: Best for using a co-borrower Overview: LendingClub started as a peer-to-peer lender, but has since transitioned to a loan marketplace.

Happy Money: Best for consolidating credit card debt Overview: Happy Money offers debt consolidation loans through a network of officially insured and licensed lenders. Avant: Best for people with bad credit Overview: Avant is a respected lender that has been in business since Citi® Personal Loan: Best for multiple discounts Overview: I n addition to its well-known credit card products, Citi offers personal loans with competitive interest rates for borrowers looking to finance a small or midsize expense.

Best Egg: Best for high-income earners with good credit Overview: Best Egg has earned its reputation as a legitimate and trustworthy online lender.

Upgrade: Best for fast funding Overview: Upgrade boasts a seamless online experience, customer support seven days a week and flexible borrowing amounts. Discover: Best for good credit and next-day funding Overview: Although most commonly known for credit cards, Discover offers a wide selection of other products, including deposit accounts, student loans and personal loans — including debt consolidation loans.

How we made our picks for the best debt consolidation loan lenders. The interest rates, penalties and fees are measured in this section of the score.

Lower rates and fees and fewer potential penalties result in a higher score. We also give bonus points to lenders offering rate discounts, payment grace periods and that allow borrowers to change their due date. Minimum loan amounts, number of repayment terms, eligibility requirements, ability to apply using a co-borrower or co-signer and loan turnaround time are considered in this category.

Customer experience This category covers customer service hours, if online applications are available, online account access and mobile apps. This includes listing credit requirements, rates and fees, in addition to offering prequalification. Clock Wait. years in business. Alternatively, the funds could simply be deposited into your bank account — they would have to be used to pay off your debts and once that was done, you'd just need to pay back your debt consolidation loan with fixed, equal monthly payments over a specified timeline.

Like any loan, you'll be charged interest , but unlike credit card interest — which averages about Typically, your interest payments are calculated into your monthly payment and divided over the lifetime of the loan, with most loan terms ranging anywhere from six months to seven years. The longer the term, the lower your monthly payment will be, although you'll be charged more interest over time so it's best to elect for the shortest-term loan you can afford.

Some lenders also charge a sign-up or origination fee, however there are several no-fee options with varying interest rates available depending on your credit score. Choose a personal loan that doesn't carry too many fees whenever possible and always make sure you're comfortable with the terms and features of the loan before you accept it.

So let's say you apply for a credit card like the Citi Simplicity® Card or the U. Just keep in mind that you'll have to pay a balance transfer fee, which will vary depending on the credit card you choose.

Still, if you have a high amount of debt paying the balance transfer fee can definitely be worth it , as you won't have any interest compounding. Read our Citi Simplicity® Card review.

One major draw to consolidating your debt is the potential to receive a lower interest rate, which can end up saving you hundreds or even thousands of dollars in the long run.

Bankrate's website has an online interest calculator you can use to figure out how much you'd have to pay in interest over the life of a loan — or until you pay off your debt.

Keep in mind that while the new interest rate you receive may not always be drastically lower than your current rate, some savings are still better than none at all.

To earn cash back, pay at least the minimum due on time. See rates and fees. Terms apply. Read our Citi Double Cash® Card review. After that, the variable APR will be Balance transfers for both cards must be completed within 4 months of account opening.

Another side effect of having a lower interest rate for your debt is the ability to repay your balance a little faster. Having high interest rates often leaves borrowers feeling as though the majority of their monthly payment goes toward the interest rather than the principal, while having a lower interest rate may actually allow you to put some extra cash toward the principal.

If this is your goal with debt consolidation , apply for a personal loan that doesn't charge prepayment penalties , extra fees charged for paying off your loan earlier than you were supposed to. While the actual cost of a prepayment penalty varies depending on how it's being charged, these can appear as a percentage of your loan balance, as the amount of interest your lender is missing out on since you paid it off early or as an additional fixed fee.

Read the terms of the loan to figure out if there's a prepayment penalty. Rates without AutoPay are 0. Excellent credit required for lowest rate. Rates vary by loan purpose.

Not only can debt consolidation help you save money, it can also help you feel more financially organized. When you apply for a debt consolidation loan, the lender will send the funds to your creditors to pay off those balances , so the only monthly payment you'll be making is for the loan itself.

Having just one monthly payment instead of several can help ease the pressure of having to remember to make multiple payments each month before their due dates, which can be especially stressful if you don't have an Autopay option set up.

Remember, if you do miss a payment or if it is late, the lender may report this to the credit bureaus, which could result in your credit score taking a hit. Some personal loan lenders try to make your monthly payments as easy as possible by offering an interest rate discount just for enrolling in Autopay.

SoFi and LightStream Personal Loans are just a couple of lenders that offer a 0. The interest rate you receive for any new loan or line of credit will depend on your credit score and credit report.

Generally, a higher credit score will allow you to qualify for lower interest rates, while a lower credit score will land you higher interest rates.

It's also a good idea to not apply for a new loan if you've recently applied for other lines of credit since too many hard inquiries on your credit report can lower your credit score and lead to higher interest rates.

Personal loan and debt consolidation lenders do accept applicants with less than ideal credit scores — while you'll be approved for the loan, you'll likely receive a higher interest rate if your credit score is on the lower side.

Debt consolidation works best when you are able to receive an interest rate that's lower than the rates you're paying for your current debts.

Many lenders allow you to check what rate you'd be approved for without hurting your credit score so you can make sure you're okay with the terms before signing on the dotted line. If you are not comfortable with the interest rate you'll receive for your debt consolidation loan, you might want to consider using the debt snowball method instead, which entails paying more toward your debt with the lowest balance while paying just the minimum on all your other debts.

Once that debt is paid off, you can move onto the second lowest balance and repeat the process until you're debt-free. This process allows you to knock out one debt faster, which can make you feel more accomplished and motivated to keep tackling the others.

See if you're pre-approved for a personal loan offer. As with any form of credit or loan, late or missed payments have the potential to hurt your credit score. Remember that any time you apply for a new loan or line of credit, you're opening up a hard inquiry on your credit report, and as a result, your credit score will be temporarily lowered.

Skipping a payment or making a late one on top of that can result in an even lower credit score.