Streamline Your Finances: Best Debt Consolidation Loans
If you’re ready to take authority of your finances, debt consolidation can effectively streamline payments and potentially decrease your interest charges.
It also may reduce your monthly debt payments.
That’s because, unlike credit cards, health loans, and other types of debt, personal loans often come with low-interest rates, especially if you have good credit.
Many lenders also offer direct payments to third-party lenders, so you don’t have to worry about the speed of settling your third-party debt.
The best personal loans for debt consolidation offer low Annual Percentage Rates (APRs) and flexible repayment plans while avoiding fees like early payment penalties, so you can retire debt early without paying a fee.
What are Debt Consolidation Loans?
Debt consolidation loans are loans taken out to pay off numerous current debts.
Rather than managing several debts with different interest rates and payment schedules, a debt consolidation loan allows borrowers to merge all their debts into one loan with a single monthly payment.
Generally, a debt consolidation loan will have an inferior interest rate than the individual debts being consolidated, which can help the borrower save Money over time.
Further, consolidating debt can simplify repayment and decrease the risk of missing payments or defaulting on a loan.
Debt consolidation loans can be secured or unsecured.
A secured loan demands collateral, such as a home or car, to back the loan, while an unsecured loan does not need collateral.
Nevertheless, unsecured loans may have higher interest rates corresponded to secured loans.
It’s noteworthy to note that debt consolidation loans may not be the best key for everyone.
It’s essential to consider all options and aspire advice from a financial professional before deciding.
Best Debt Consolidation Loans:
Personal loan interest rates rely on several characteristics, including the borrower’s creditworthiness, lender, loan amount, and repayment term.
Generally, nevertheless, individual loan interest rates range from approximately 5.99% to 36%, with the most inferior rates reserved for borrowers with excellent credit.
Achieve – This One Is Best For Paying Off Credit Card Debt
Achieve is an indirect lending platform that delivers personal loans backed by Cross River Bank or MetaBank.
Established in 2014, the lender is one of our leading selections for debt consolidation loans because of the adjustable loan terms (two to five years) and loan amounts ($7,500 to $40,000).
These aspects make consolidating a large amount of debt more manageable while distributing payments over a long period and lowering monthly payments.
Applicants must include a credit score of at least 620 to allow for an Achieve personal loan.
Prospective borrowers should also have the lowest gross income of $21,500, assuming that Achieve will not lend more than 35% of the borrower’s annual income.
If you want to reduce your other loans but don’t have an excellent credit score, Achieve allows both co-signers and co-applicants, with about 30% of borrowers holding joint loans.
Achieve loans can cover home modification costs, wedding and trip expenses, medical costs, moving expenses, and, most significantly, debt consolidation.
Achieve declares you could be authorized for your loan on the identical day you apply. You may be able to obtain your funding in as small as 48 hours.
Pros of Achieve:
- Funds available within 48 hours
- Flexible repayment terms
- Allows co-borrowers
Cons of Achieve:
- The application is not entirely online
- Imposes a minimum income requirement
- High minimum loan amount
Discover – Discover Is Best for No Interest If Repaid Within 30 Days
In addition to providing consumer banking, credit card and retirement solutions, Discover Personal Loans in all 50 states.
The platform stands out for credit support because the loan is from $2,500 to $35,000, and the term extends to seven years, more than what is available for many other personal loans.
This means that in addition to benefitting from lower interest rates, you can reduce your monthly debt obligations by extending your loan for a longer period.
To qualify for a personal loan search for debt consolidation, borrowers must have a minimum credit score of 660; The average Discover borrower has a score of 750.
Discover does not require applicants to have a minimum credit history, but applicants must demonstrate a minimum household income of $25,000 annually.
Applicants are also evaluated based on their credit history, recent credit activity, and other credit questions. Subscribers and applicants are not accepted.
Personal loans can be used for many personal uses, including debt consolidation.
And, unlike some personal loan providers, Discover loans can be used to cover small business expenses.
Like other lenders and consumers, Discover cannot use Discover loans to pay for high school education, pay off secure loans, or engage in illegal activities.
Applicants receive a decision on the same day.
If approved, funds can be sent as early as the next business day if the loan is approved on the weekend and there are no typos or errors in the application.
Otherwise, the borrowers will not receive the loan amount for 7 days.
Discover can also distribute money directly to other lenders when a loan is used for debt consolidation.
Pros of Discover:
- Option to pay off creditors directly
- No origination fees or prepayment penalties
- Directly pays creditors
Cons of Discover:
- Charges late fees
- Low maximum loan amount
Upgrade – One Should Choose Upgrade for Bad Credit
Upgrade applicants must have a minimum credit score of 580 to qualify for a personal loan.
This makes it an affordable option for people with good credit who want to consolidate their debt.
In addition, promoters are not required to meet the minimum requirements.
But the average borrower makes more than $95,000 a year. The promotion increases loan access by allowing enrolls and borrowers.
Loans from Upgrade must be used to pay off credit cards, consolidate other debt, make home improvements, or pay for other large purchases.
Unlike some other lenders, Upgrade also offers direct payment to third-party creditors, though it can take longer for these funds to be processed.
Once a payday loan is approved, the borrower usually takes four business days to receive the money.
However, if a direct lender’s payday loan is advanced to another lender, the funds may take up to two weeks to clear.
Pros of Upgrade:
- Low minimum credit score requirement
- Borrowers can use loans for business expenses
- Offers direct lender payoff
Cons of Upgrade:
- High APR range
- Charges fees for origination, late payment, and insufficient funds
- Only offers two loan repayment period
Universal Credit – This One Is Best For Comparing Multiple Offers
About Universal Credit:
Universal Credit is an online lending system that offers loans between $1,000 and $50,000 through its partners.
Repayment terms range from 36 to 60 months or three to five years.
Universal credit requires a minimum score of 560, making it suitable for most borrowers.
Once agreed, Universal Credit will transmit your funds to your bank within one business day.
Nevertheless, the availability of your funds relies on how fast your bank can process the marketing.
If you’re using reserves to pay off another creditor directly, it may take up to two weeks.
Pros of Universal Credit:
- Flexible qualification requirements
- Next-day funding
- No prepayment penalty
Cons of Universal Credit:
- High APRs
- All personal loans charge a 4.25% to 8% origination fee
Happy Money – Happy Money Is Best For Flexible Repayment Terms
About Happy Loans:
Founded in 2009, Happy Money (previously Payoff) is an online lending platform that connects prospective borrowers with fixed-rate credit card debt consolidation loans in every state except Massachusetts, Mississippi, Nebraska, and Nevada.
Happy Money specializes in helping borrowers get rid of their high-interest debt and will immediately pay members out of outstanding credit.
To qualify for a happy money loan, applicants must have a minimum credit score of 640, although approved applicants have an average score of 705.
Applicants must also have a three-year lowest credit history, no recent delinquencies, and a debt-to-income ratio beneath 50% to be eligible.
There is no minimum income requirement, but Happy Money does not offer co-signer or applicant fees to borrowers so that applicants will qualify based on their financial situation.
Happy Money specializes in credit card debt consolidation, making it a great choice for readers who want to control their finances and plan repayments.
Application may take three to seven business days after application submission and all necessary documents.
After receiving approval and signing, you will receive Money within three to six business days, depending on the representative.
Pros of Happy Money:
- Directly pays third-party creditors
- Competitive APRs
- Assists borrowers with financial wellness through its Peace program
Cons of Happy Money:
- May charge an origination fee
- Limited repayment terms
- Requires a minimum credit history of three years
Best Egg – One Should Choose This for Debt Consolidation Perks
About Best Egg:
Best Egg is a lending platform for lenders in all states except Iowa, Vermont, West Virginia and Washington, DC Cross River Bank and offers personal loans from $2,000 to $35,000, although offers up to $50,000 may be available.
Loans can be used for debt consolidation with three to five years of payment terms. So the best mortgage can be a good way to spread other debts and spread the debt over time.
Applicants for Best Buy must have a minimum credit score of 640 to qualify for a personal loan, but the platform does not disclose the minimum amount required.
A borrower’s loan term, amount and APR will depend on their credit score, income, payment activity, loan amount, credit history, and other factors.
Like other lenders, borrowers can use Best Egg Loan Funds to make their money easier through debt consolidation and credit card repayments.
But the best mortgage loans are as flexible as those other lenders offer.
They can be used for various purposes, including home improvements, moving and relocation, or taxes and medical bills.
However, as with most lenders, the loan cannot be used for high school education expenses, the purchase or travel of security, or illegal activities.
The best mortgage loan application process can take less than five minutes.
Expect loan approval and funding to take up to three business days, although some customers may receive funds in one day.
Pros of Best Egg:
- Loan terms available for up to five years
- Low minimum APR
- No prepayment penalty
Cons of Best Egg:
- Does not offer direct payment to third-party creditors
- Charges an origination fee
- The maximum repayment term of five year
Lending Club – This One Is For Peer-To-Peer Lending
About Lending Club:
Lending Club is a peer-to-peer lender and online lending platform for personal loans.
The platform lends to every state except Iowa, has worked with over 3 million customers, and has disbursed more than $55 billion in loans since its inception in 2007.
And, since Lending Club doesn’t offer quick cash transfers, it will pay your creditors directly, so you don’t have to worry about the speed of loan approval.
To qualify for a Lending Club personal loan, applicants must have a minimum credit score of 600 and a credit history of at least three years.
We also agree that applicants must have a debt ratio of no less than 40% for sole and 35% for applicants.
These factors, including proof of income, help investors and lenders decide who they want to lend to.
Applicants are welcome (you live in the same house), but registrants are not.
Lender Club Loans can be used for personal purposes, including debt consolidation.
Lending Club make it easier for borrowers to refinance their debt by providing loans directly to other lenders.
Like most lenders, mortgage lenders are prohibited from using the money for high school education, investment purchases, gambling and illegal activities.
Home loan lenders typically receive loan payments within four business days.
However, this time may vary if the application is complete or the lender requires additional documents or approvals.
Pros of Lending Club:
- Will directly pay off third-party creditors as part of balance transfer loan
- Co-applicants permitted
- Available to borrowers with fair to excellent credit
Cons of Lending Club:
- Origination and late fees
- Limited loan term availability
- High APR range
Light Stream – This One Is Best For Low-Interest Rates
About Light Stream:
Light Stream is the consumer lending division of Trust formed through the merger of SunTrust Bank and BB&T.
The platform offers unsecured personal loans from $5,000 to $100,000.
The loan amount varies depending on the purpose of the loan.
While most lenders offer smaller loans than the Light Stream minimum, a few offer higher ones.
Repayment terms range from two years to seven years, making it a great option for those who want to spread the payment of large expenses over time.
Light Stream recommends applicants have good credit before applying for a personal loan.
To increase their chances of approval, applicants must have several years of credit history, including several types of accounts, stable income to pay off current debts, and a new Light Stream loan.
Light Stream does not allow potential borrowers to qualify for a loan.
This fact, combined with the minimum credit score requirement, makes the platform the best option for those with a strong credit profile.
Applicants with excellent credit can also get a good deal.
Light Stream does not allow sign-ups, but potential borrowers can submit a link application.
Loans from Light Stream can be used for various purposes, from buying a new car, RV, or jewellery to paying for home improvements.
However, Light Stream stands out because loans can be used to finance real estate, seasonal sales and so-called small houses.
Like other lenders, Light Stream prohibits using its loans for higher education expenses, business purposes and illegal activities.
Lenders are prohibited from using Light Stream Loans to refinance existing Light Stream Loans.
Turnaround time: Light Stream borrowers can receive same-day cash if the loan is approved by 2:30 pm Eastern on bank business days.
To receive same-day financing, the applicant must review and electronically sign the loan agreement, provide Light Stream with funding preferences and relevant banking information, and complete the final verification process before 2:30 pm when the loan is approved.
Pros of Light stream:
- No origination, prepayment, or late fees
- Low, competitive rates
- Fast approval and funding
Cons of Light stream:
- No prequalification process
- No due date flexibility
- Limitations on the use of loan proceeds
Sofi – Sofi Is Best For Large Loan Amounts
SoFi is an online lending system that offers unsecured personal loans in all states except Mississippi.
Founded in 2011, SoFi has provided more than $50 billion in loans and is distinguished by offering large loan amounts and the availability of loan terms.
Personal loan applicants must have a minimum credit score of 650. However, most successful applicants have a score of 700 or higher.
Applicants must have an annual income of at least $45,000, although the average income for a SoFi borrower is over $100,000.
SoFi personal loans are generally limited to personal, family and household purposes.
The borrower can use the loan amount to cover medical bills, credit card approvals, home repairs, and travel expenses.
However, SoFi loans cannot finance new businesses, buy real estate, invest in securities, post-secondary education, or make short-term investments.
Lenders receive funds within days or in as little as one day of business support and process approval.
However, the disbursement time may take a few days, especially for loans over $20,000.
Pros of SoFi:
- Prequalification with soft credit check
- Funding in as little as one to two days
- High loan amounts and lengthy terms
Cons of SoFi:
- Does not offer direct payment to third-party creditors for debt consolidation
- Some applicants report difficult qualification standards
- Co-signers are not permitted
What are the factors one needs to keep in mind when looking for a debt consolidation loan?
When looking for a debt consolidation loan, it’s important to consider the following factors:
- Interest rates: Look for a loan with a lower interest rate than the average rate of your current debts. A lower interest rate can help you save Money in the long run.
- Fees: Watch out for origination fees, prepayment penalties, and other charges that can add to the loan cost.
- Loan terms: Look for a loan with a repayment term that works for you. Longer terms can result in lower monthly payments but may also result in paying more interest over time.
- Lender reputation: Choose a lender with a good reputation, positive reviews, and a history of providing excellent customer service.
- Eligibility requirements: Check the lender’s requirements to ensure you qualify for the loan.
Once you’ve identified potential lenders, compare their interest rates, fees, and terms to determine which loan best fits your financial situation.
Consider applying for preapproval to get an idea of the interest rate you’ll qualify for before officially applying for a loan.
Remember that debt consolidation loans are not a one-size-fits-all solution, and it’s important to carefully consider your options before deciding.