What Is Debt Consolidation?
Debt consolidation – not to be confused with debt settlement – is just like it sounds. It’s a simple way to use a personal loan to consolidate multiple unsecured debts (like credit cards, medical bills, payday loans) into one monthly bill. For example, instead of making payments to multiple creditors, you make a single payment to the debt consolidation loan’s lender instead.
Because personal loan rates can be lower than credit card rates (which have an average of around 15% APR), it’s possible to save a lot of money in interest rate payments. By extension, this could help lower monthly payments and/or pay down debt faster.
The best way to compare apples to apples is to get personalized rates for your current situation. It’s effortless – almost like searching for a flight or hotel.
Debt Consolidation Loans Pros
- Potentially lower interest rates vs. credit cards
- Easy application process
- Less risk since an unsecured personal loan isn’t tied to an asset
- Funds usually come through quickly
- Potential credit score increase
Debt Consolidation Loan Lenders
View here some banks and financial companies offering debt consolidation loans:
With Upstart, you get a free loan rate in minutes without hurting your credit score. You can also consolidate all your debt into one easy, low-rate payment.
LendingPoint offers personal loans and financing options up to $25,000. Check your loans options without affecting your credit score today.
Whether you need to pay for an unexpected auto repair, reduce your credit card debt or get funds to remodel your kitchen, Rocket Loans is a good choice. Rocket Loans offers online personal loans at very competitive fees. Check out your loan options with their easy online application process today.
Upgrade makes applying and getting an affordable personal loan fast and simple. Check your rate today with no impact to your credit score.
Debt Consolidation Loans Cons
- Sometimes lenders charge origination fees. Double-check the numbers & do a bit of “comparison shopping” to make sure you get the best offer available.
- Teaser rates require a high credit score (somewhere between 780-850). Note that it’s pretty easy to get rates personalized to you.
- There aren’t many options available (if at all) for credit scores below 600.