Debt consolidation loans are new loans that are used to pay off old loans, both automatic, personal, student loans, or almost any other type of loan / debt. Applying for any loan will have an impact on your credit, so you must choose the best lender before you begin to minimize the impact on your credit history.
If you choose the right approach for debt consolidation, you can save hundreds or even thousands of dollars in interest while also reducing the pressure of multiple payments several months.
When choosing the loan that is right for you, you need to consider interest rates, origination fees, initial payment fees, and minimum credit scores. Follow along to learn more about these factors and find a debt consolidation loan that best meets your financial needs.
1. Marcus by Goldman Sachs
Personal loans from Marcus by Goldman Sachs are our first choice because of the combination of competitive interest rates and no fees. There are no origination fees or prepayments (which are charged by lenders when signing loan agreements), which are common among leading lenders.
Unlike others, Marcus also does not charge late fees – but you must pay on time. Interest rates range from 5.99% to 28.99% April (5.99% to 24.99% for NY residents).
The minimum credit score for new loans is 660 on FICO 9 and 580 on the VantageScore 3.0 scale, which limits some borrowers with bad or bad credit. If you can get a better interest rate elsewhere, you should consider it.
But on the contrary, you can’t beat Marcus by Goldman Sachs thanks to an unbeatable fee schedule. You can borrow $3,500 to $40,000 in loans.
Marcus is a new bank from Wall Street, Goldman Sachs. The loan takes about one to four days to fund. Lenders are generally reviewed well.
2. OneMain Financial
OneMain Financial does not have a minimum credit score and accepts several borrowers with bad credit. The cost of origination varies based on the state and interest rates ranging from 16.05% to 35.99%.
Even though you might pay a higher interest rate at OneMain Financial, if you cannot be approved elsewhere due to past credit errors, that may be your only choice.
Unlike most lenders on this list, OneMain Financial has physical branches in 44 countries. Loans are available from $1,500 to $30,000 for a period of two to five years. In some cases, you can be funded on the same day.
OneMain Financial also offers a guaranteed loan, a type of loan where you guarantee collateral such as the title of the car to get a lower interest rate. With this type of loan, if you stop paying, you can lose your collateral.
Discover Personal Loan
If you have good credit, Discover offers loans of $2,500 to $35,000 without initial fees and competitive rates. Interest rates run from 6.99 percent to 24.99 percent APR depending on your credit. The term of the loan varies from three to seven years.
Discover Personal Loans is available for borrowers with credit scores of 660 and above. Although it can take up to a week to get funds, if you can get a lower interest rate here and there is no origination fee, it’s probably the best lender for maximum savings.
Best Egg offers a variety of the best interest rates for high credit borrowers, even for borrowers with lower credit scores. The company offers fixed APR starting from 5.99% to 29.99% based on your credit history.
Best Egg offers three or five-year loans and works with borrowers with a credit score of 640 or higher. That said, you have to pay an origination fee of 0.99% to 5.99% based on your credit.
Loans are available for $2,000 to $35,000. That means the origination fee will cost you between $19.80 and $2,096.50 depending on the size of your loan and your credit history.
You can be funded very quickly, in just one day, which is a great benefit for someone who is itching to complete their consolidation.
With Lending Club, you don’t borrow from large banks or independent lenders. Instead, loans go to the market where they are funded with an increase of $25 or greater until the loan is fully funded. Lending Club is the largest loan market of its kind with a $38 billion loan fund.
Lending Club offers loans ranging from $1,000 to $40,000 with a term of three or five years. You need a credit score of 600 or higher to qualify. Interest rates range from 6.95% to 35.89% APR and origination fees range from 1% to 6% based on your credit.
These lenders generally have a good rating from customers. Despite having bad publicity because of the actions of its former CEO, the company seems to have changed direction and is now among the highest debt consolidation loan options. https://bit.ly/2YH4UbB
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