If you’re in deep with credit card and other unsecured debt and you don’t seem to be making a dent, a consolidation loan can simplify your payments and possibly lower the interest rate you’re paying on your current obligations. If you think this might be a good move for you, here are the best places for debt consolidation loans.
What Is A Debt Consolidation Loan?
Let’s start there. Debt consolidation involves taking out a new loan to pay off other liabilities and consumer debts. In addition to a fixed repayment schedule, debts are rolled into a single, larger debt, usually with a lower interest rate or lower monthly payment. Sometimes, both.
Debt consolidation best suits those with good credit, since a favorable score will qualify you for the best rates on the combined debts.
Your credit will be nicked initially since your lender will do a hard credit inquiry. Over time, though, a consolidation loan may help to improve your credit because you’ll be more likely to make your payments on time. Your payment history comprises 35% of your credit score.
Where To Find A Top Lender
With that in mind, let’s take a look at some of the best places for a debt consolidation loan. The top ones include Marcus by Goldman Sachs, Discover, Payoff, Lightstream, SoFi, and Upgrade.
Marcus By Goldman Sachs offers low rates and was chosen as the best overall. It lends a minimum of $3,500 up to $40,000 at a fixed annual percentage rate (APR) of between 6.99% and 19.99%. Repayment terms are 36 to 72 months, and you need a credit score of more than 660. Funds are available as soon as one to four days. The company was also cited for its easy application process, and its lack of late or origination fees.
Discover was chosen as best for flexible repayment options. It lends $2,500 to $35,000 at an APR of between 6.99% and 24.99%. Terms are 36-84 months, and your credit score must exceed 680. It may take longer than one day to get your funds.
Payoff was picked as best for consolidating credit card debt. You can borrow between $5,000 and $40,000 at 5.99% to 24.99% APR. Loans must be repaid between 24-60 months, and that credit score needs to be over 640.
Lightstream was tapped as the best for low rates. With autopay, those rates range from 3.99% to 19.99% on loans from $5,000 to $100,000. Terms are between 24 and 85 months, and you need a credit score better than 680. In some cases, Lightstream can get you your funds the same day.
Sofi is best for large debts, offering loans of between $5,000 and $100,000 at interest rates of between 5.99% and 25.05%. Loans require a credit score of more than 680 and must be repaid between 24 and 84 months. Another benefit is unemployment protection. Loans do have an origination fee of between 0% and 5%, and you must meet income requirements.
Upgrade was picked as best for bad credit. Indeed, it requires a credit score of just 580. Interest rates are between 7.99% and 35.99% on loans between $1,000 and $35,000. You can get your money as soon as one day after information verification. Origination fees are on the high side, however, at between 2.9% and 8%.
Somewhere on this list of the best places for debt consolidation loans, you’ll hopefully find the one that’s just right for you.