Best Debt Consolidation Loans

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Advertised & Editorial Rates: This table includes two types of listings : ads that we may be paid for ( “ advertiser listing ” ) ; and listings that we research and publish to provide a more holistic scene of market rates ( “ column listings ” ). here ’ s how to tell the difference : if you see a clickable button, such as a green “ Next ” button, that is an advertiser list, and if you do not see a clickable button, it ’ s an column list. For more information, see our Advertising disclosure Accuracy of Advertised Terms: Each advertiser is responsible for the accuracy and handiness of its ad extend details. however, we attempt to verify those details through our quality control broadcast. For more information, see our Quality Control Program. Editorial Content: We include editorial content below the rate table to educate consumers about fiscal products and services. Some of that content may besides contain ads, including links to advertisers ’ sites, and we may be paid on those ads or links. For more information, see How We Make Money. american consumers had a entire of $ 820 billion in citation card debt at the end of 2020, according to the Federal Reserve Bank of New York. Although sum debt obliglations were lower in 2020 than in the years before, consumer debt ( recognition cards, car, and personal loans ) even accounted for 5.4 % of american households ’ disposable income. If you have a distribute of high-interest debt, such as credit card debt, personal loans, checkup loans, or payday loans, a debt consolidation lend could be a estimable option. If you consolidate this debt into a single lend with a lower interest rate than your existing debt, you can save on interest, pay off your debts faster, and streamline your finances with one monthly payment. Keep in judgment that a debt consolidation loan only makes feel if you can get an interest rate that ’ s lower than the current pastime rate of your existing debts. You should besides take into account any fees. Always comparison shop between multiple lenders to get the best rate potential, then run the numbers yourself to see if a debt consolidation loanword makes sense for your personal situation. If you ’ rhenium looking for a position to start, hera are our picks for the best debt consolidation loans .

Best Debt Consolidation Loan Rates in April 2022

INSTITUTION CURRENT APR LOAN TERM RANGE MIN. LOAN AMT. MAX LOAN AMT.
LightStream 3.49% to 19.99% (0.50% autopay discount included) 2 to 7 years $5,000 $100,000
SoFi 5.74% to 21.78% (0.25% AutoPay discount included) 3 to 7 years $5,000 $100,000
Payoff 5.99% to 24.99% 2 to 5 years $5,000 $40,000
Best Egg 5.99% to 35.99% 3 to 5 years $2,000 $50,000
Marcus by Goldman Sachs 6.99% to 19.99% (0.25% AutoPay discount included) 3 to 6 years $3,500 $40,000
Discover 5.99% to 24.99% 3 to 7 years $2,500 $35,000
Rocket Loans 5.97% to 29.99% (0.30% AutoPay discount included) 3 to 5 years $2,000 $45,000

How We Chose These Lenders

This list does not represent the entire grocery store. We began by analyzing the most normally reviewed and searched-for debt consolidation loanword rates. We lone included lenders that offered loans marketed specifically as debt consolidation loans. however, it ’ mho worth noting that early lenders offer personal loans that can be used for debt consolidation purposes excessively. then, we cut out any lenders based on the pursuit criteria :

  1. We eliminated lenders that don ’ t make it easy to find substantive loanword information like APRs, fees, minimal and utmost loan amounts, and available loanword terms on their websites without entering an e-mail or other personal information. many lenders prominently display this information on their sites, making it easily to compare to other lenders. If you are in the marketplace for a debt consolidation lend, we ’ five hundred recommend a diaphanous lender that doesn ’ deoxythymidine monophosphate require personal data for a rate comparison .
  2. We ruled out any lenders whose max APR exceeds 30 %. Since the finish of a debt consolidation loanword is to consolidate your existing high-interest debt into a single loan with a lower pastime rate, we believe that it makes sense to feature of speech lenders whose median interest rates are lower than the modal credit card pastime rate. Keep in thinker that the rates listed on lender websites are only general ranges with the minimum and utmost rates. The rate you qualify for will likely fall somewhere between and will depend on factors like your credit mark and loanword term. The only means to know the accurate rate you ’ ll get is to prequalify or apply for a loanword .
  3. Our number only features directly lenders quite than intermediaries or lend marketplaces. We besides ruled out credit unions, which have unique membership requirements and limit the number of people who could easily consider them for a lend. Credit unions can offer competitive rates to those who qualify ; check your local area or use a credit union locator to compare rates .
  4. besides, none of these lenders charge any fees or penalties for early payments or differently paying off your loan early. We don ’ deoxythymidine monophosphate think you should always have to pay a tip to get out of debt fast. We will never recommend a personal loanword that includes such a tip or penalty .
  5. last, we eliminated any lenders that did not have an A rate or higher with the Better Business Bureau .

The above rates and lend information is accurate as of April 4, 2022. The NextAdvisor editorial team updates this information regularly, though it is potential APRs and other information changed since it was last update. Some lenders may offer a rate rebate if you pay with AutoPay. If the advertise rates include an AutoPay discount rate, it will be distinctly marked. besides, some loan offerings may be specific to where you live. Keep in mind that the longest loan terms and largest loanword amounts may alone be available to borrowers with the best credit .

Lender Overview

LightStream

Overview: A division of Truist Bank, LightStream offers fee-free debt consolidation loans with no fees for borrowers with good to excellent credit. Pros: LightStream charges no fees on its loans and offers the Rate Beat plan, which will offer a rate 0.1 % lower than rates from competing lenders for the same lend term, with certain conditions. LightStream besides offers a $ 100 Loan Experience Guarantee, where if you ’ re not satisfied with the service you received and explain why in a questionnaire, the company will send you $ 100. Cons: LightStream requires you to go through the entire application process ( including a hard credit question, which can affect your credit rating score ) to know the exact rate you ’ ll catch, making it hard to shop around and compare with other lenders .

LIGHTSTREAM
Current APR 3.49% to 19.99% (0.50% autopay discount included)
Loan Term Range 2 to 7 years
Loan Amount $5,000 to $100,000
Prepayment Penalty None
Origination Fee None
Minimum Annual Income None specified
Co-Borrower Allowed? Yes
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

SoFi

Overview: SoFi offers no fees, a way to prequalify on-line, and other perks. But loanword eligibility is limited to those with good credit scores and who are presently or soon-to-be employed or have another informant of income. Pros: SoFi charges no initiation fees or belated fees ( although you ’ ll even be on the hook for interest on deep payments ). SoFi offers an unemployment protective covering program that will pause your payments and provide speculate placement aid if you lose your problem. Cons: SoFi has stricter eligibility requirements than other lenders on this list. In addition to credit grade requirements, you besides have to be presently employed, have sufficient income from other sources, or have an volunteer of use that starts within 90 days to qualify for a lend. finally, SoFi loans are not available to residents of Mississippi.

SOFI
Current APR 5.74% to 21.78% (0.25% AutoPay discount included)
Loan Term Range 3 to 7 years
Loan Amount $5,000 to $100,000
Prepayment Penalty None
Origination Fee None
Minimum Annual Income None specified, but employment or alternative income is required
Co-Borrower Allowed? Yes
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

Payoff

Overview: Payoff by Happy Money specializes in debt consolidation loans and has lower credit score requirements than some other lenders on this list. You can besides prequalify on-line without a hard credit check. Pros: With a lower credit score requirement than some other lenders on this tilt, Payoff may be more accessible to those who may not have good or excellent credit. Keep in beware, though, that accredit score international relations and security network ’ t the alone determining factor lenders use when deciding whether to grant you a loanword. Payoff members besides get free monthly FICO score updates. Cons: You need to have at least three years of established credit to qualify for a Payoff lend. In addition, Payoff loans aren ’ thymine available in Massachusetts, Mississippi, Nebraska, and Nevada .

PAYOFF
Current APR 5.99% to 24.99%
Loan Term Range 2 to 5 years
Loan Amount $5,000 to $40,000
Prepayment Penalty None
Origination Fee 0% to 5%
Minimum Annual Income None specified
Co-Borrower Allowed? No
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

Best Egg

Overview: Best egg offers debt consolidation loans with a quick application process and the choice to prequalify on-line. Like Payoff, Best Egg offers loans to borrowers with “ clean ” credit ( 640 and above ). Pros: Best egg has a quick on-line application serve, allowing you to receive funds in adenine little as one business day. Cons: Although Best Egg offers loans to those with carnival credit, getting the lowest april advertised requires you to have an annual income of at least $ 100,000 and a minimum FICO citation score of 700 .

BEST EGG
Current APR 5.99% to 35.99%
Loan Term Range 3 to 5 years
Loan Amount $2,000 to $50,000
Prepayment Penalty None
Origination Fee 0.99% to 5.99%; at least 4.99% for loan terms longer than four years
Minimum Annual Income $100,000 minimum individual annual income for the lowest APR
Co-Borrower Allowed? No
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

Marcus by Goldman Sachs

Overview: Marcus, a subordinate of Goldman Sachs, offers fee-free debt consolidation loans for borrowers with good-to-excellent credit. Pros: Marcus offers an on-time requital reinforce where if you pay your loanword on time and in full every calendar month for 12 months, you can get an interest-free requital deferral for one month. Marcus besides charges no origin fees, sign-up fees, or late fees. Cons: Although Marcus doesn ’ deoxythymidine monophosphate specify a minimal credit score needed to qualify for a loanword, it does say you ’ ll need good or excellent credit ( 700-850 ) to get the lowest rates .

MARCUS BY GOLDMAN SACHS
Current APR 6.99% to 19.99% (0.25% AutoPay discount included)
Loan Term Range 3 to 6 years
Loan Amount $3,500 to $40,000
Prepayment Penalty None
Origination Fee None
Minimum Annual Income None specified
Co-Borrower Allowed? No
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

Discover

Overview: This popular trust and credit wag company besides offers debt consolidation loans with no initiation fees, flexible refund terms, and same-day decisions in most cases. Pros: Discover charges no origin fees, and no other fees, arsenic long as you pay on time. Discover offers a same-day decision in most cases, angstrom well as an option to pay off creditors directly. If you change your mind about needing the lend, you ’ ll wage no interest if you return the lend funds within 30 days. Cons: You need a minimum family income of $ 25,000 to qualify for a Discover loanword. In addition, you can ’ thyroxine use the loanword to pay off a batten loan or directly pay off a Discover credit rating card .

DISCOVER
Current APR 5.99% to 24.99%
Loan Term Range 3 to 7 years
Loan Amount $2,500 to $35,000
Prepayment Penalty None
Origination Fee None
Minimum Annual Income $25,000 household income
Co-Borrower Allowed? No
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

Rocket Loans

Overview: Rocket Loans, a subsidiary company of mortgage company Quicken Loans, offers debt consolidation loans for people with “ inadequate ” citation, although you may pay higher interest rates. Pros: Rocket Loans offers on-line preapproval arsenic well as same-day fund. Cons: The maximal interest rate for Rocket Loans is on the high side of the spectrum for this number, although the minimum interest rate is on the moo side. Keep in heed that the exact matter to rate you ’ ll get depends on your credit score, and those with poor credit will typically get higher rates. Rocket Loans merely offers two loanword terms : 3 years and 5 years .

ROCKET LOANS
Current APR 5.97% to 29.99% (0.30% AutoPay discount included)
Loan Term Range 3 to 5 years
Loan Amount $2,000 to $45,000
Prepayment Penalty None
Origination Fee 1% to 6%
Minimum Annual Income $24,000
Co-Borrower Allowed? No
Cosigner Allowed? No
Unsecured Debt Consolidation Loans Yes
Secured Debt Consolidation Loans No

What is Debt Consolidation?

Debt consolidation is when you consolidate multiple sources of debt — for case, credit cards, personal loans, payday loans, or checkup bills — into a single loan. Some common reasons for consolidating debt admit :

  • Simplifying your finances by combining your debt into a single monthly payment
  • Consolidating high-interest debt, like credit card debt, into a lower-interest loan
  • Consolidating debt with a variable interest rate into a fixed-rate loan
  • Reducing your monthly payment by getting a longer loan term
  • Being able to budget better with fixed, monthly payments

The two most common ways of consolidating debt are symmetry transfer credit cards and debt consolidation loans. With a debt consolidation loanword, you take out a loan to pay off your existing debt and pay off the new loanword over a repair time time period. A libra transmit accredit circuit board comes with an basic 0 % APR, making it a good move if you qualify for one of these cards. Whether you use a balance transmit accredit card or a debt consolidation loan, it is essential to make a plan to pay off the amalgamate debt before the loan term ends or an introductory APR expires .

What is a Debt Consolidation Loan?

A debt consolidation lend is a type of personal loan taken out for the aim of consolidating debt. Although many lenders offer products specifically called debt consolidation loans, they ’ re typically the same as personal loans and have the lapp loanword terms and APRs, barely under a different identify. Some debt consolidation loans might offer benefits geared toward those looking to consolidate debt, such as the option to pay your lenders immediately through the loan provider, saving you a step. Debt consolidation loans typically fall into two categories : secured and unguaranteed. plug loans require you to put up an asset — such as a home or car — as collateral, which the lender can seize if you default on your lend. unguaranteed loans don ’ metric ton necessitate collateral. Because guarantee loans are less bad for the lender, they typically have lower APRs and credit score requirements. however, be careful when taking out a batten lend ; if you fall behind on your payments, you could lose your collateral. In general, you want to avoid trading any unbarred debt for batten debt since that increases your hazard .

Benefits of a Debt Consolidation Loan

A debt consolidation lend can help you pay off debt and improve your fiscal health when used correctly. Some benefits of a debt consolidation loanword include :

  • Lower APR. If you have high-interest debt like credit card debt, you may be able to consolidate your debt into a loan with a lower APR. A lower APR means you’ll pay less interest over the life of the loan, and you may even be able to pay off your debt faster as a result. Keep in mind the exact rate depends on factors like your credit score and debt-to-income ratio, so you’ll need to prequalify for a loan or get a quote to see your rate. A debt consolidation loan is likely not a good idea if you can’t get a lower APR than your current one. Also, be aware that fees may cut into your savings; before taking out a debt consolidation loan, always crunch the numbers to see how much you can save.
  • Regular, fixed-rate payments. If you have lots of credit card debt with no plan to pay it off, a debt consolidation loan can help. With a debt consolidation loan, you’ll make regular monthly payments with a fixed payoff date to help you budget better. You’ll also get a fixed interest rate, as opposed to a variable APR with credit cards, eliminating any surprise changes in interest charges.
  • Streamline your finances. If you have multiple sources of debt, such as several credit cards or personal loans, combining them all into a single monthly payment can simplify your finances and help you better keep track of your payment deadlines. A single missed payment on a credit card or loan can result in hefty fees or a significant drop in your credit score. A debt consolidation loan can help you avoid missing payments by reducing the number of separate bills you need to pay.

Keep in mind, a debt consolidation lend will lone help you if you go in with a design to pay off the debt. Before taking out a debt consolidation lend :

  • Calculate the interest and fees to make sure you’re saving money
  • Build the loan payments into your budget
  • Keep track of payment deadlines to make sure you don’t miss a payment.

Debt Consolidation Loan vs. Balance Transfer Credit Card

One popular option to a debt consolidation lend is a counterweight transfer credit batting order. A libra transfer citation card is a credit calling card that offers a 0 % APR basic period, which typically ranges from 6 to 20 months. You can use a balance remove credit circuit board to consolidate debt by putting your existing debts onto the credit card and paying it off before the basic time period expires, thus paying no pastime on the balance. ( Though you may have to pay a remainder transfer tip, normally around 3 %. ) The biggest disembowel of a poise transplant credit card is paying off the balance wheel before the introductory menstruation expires and, consequently, paying no concern at all. Having a plan to pay off debt is even more crucial when using a counterweight transportation card, or you ’ ll be stuck with high APRs once the introductory period ends. The best balance transfer cards are typically available only to those with effective or excellent accredit, making them less accessible than personal loans for those with poor or fair credit .

Personal Loan Balance Transfer Credit Card
• Installment loan
• Fixed interest rate for the loan term
• More options for those with poor or fair credit
• May charge an application fee, origination fee, prepayment penalty, and other fees
• Credit card
• 0% APR introductory period, then high variable APR
• Fewer options for those with poor or fair credit
• May charge a balance transfer fee, a monthly credit card fee, and other fees

Alternatives to a Debt Consolidation Loan

In accession to balance remove credit cards, there are several early alternatives to debt consolidation loans or personal loans for consolidating debt. These include :

Home Equity Loan or HELOC

You can tap into your home equity for immediate cash with either a family equity loanword or home equity agate line of credit ( HELOC ). A home fairness loanword is a guarantee installment lend where you borrow a collocate sum and pay it back, with matter to, over a fix period. A HELOC is a orb line of credit rating that works like a credit tease, where you can withdraw equally a lot cash as you need ( up to the recognition limit ) during the draw period and pay it back during the refund period. Home fairness loans and HELOCs use your home fairness as collateral and may have lower rates than unguaranteed personal loans or accredit cards. Be mindful, though, that if you default on the lend, the lender could foreclose on your house .

Cash-Out Refinance

similar to a home fairness loanword or HELOC, a cash-out refinance besides lets you use your house as a mean of accessing cash. The work just works differently. With a cash-out refinance, you take out a new mortgage with a larger value than your current mortgage, pay off your old mortgage with the money, and keep the difference as cash. Since mortgage rates are relatively low proper now, a cash-out refinance may be a better consider than a home equity lend, HELOC, or personal loan .

Credit Counseling

If you ’ re struggling with debt, many credit rating counseling agencies offer services to help you make a debt repayment plan and get your finances back on track. Credit rede is different from debt settlement, where for-profit companies negotiate with your creditors in an attack to get them to settle your debt for less than the sum sum owed. Debt village companies typically charge hefty fees for their services, and settling your debt for less than the original sum can sternly hurt your credit seduce. Credit guidance is typically offered for free or for a small fee by nonprofit organization organizations.

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