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Best debt consolidation loans

Compare top consolidation loans with rates as low as 5.6% APR.

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Bethany Hickey
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American’s average credit card debt totals $3,380, according to Finder’s Consumer Confidence Index in 2022. If your credit card debt and interest rates are high, and it’s getting tough to manage, a debt consolation loan could save you some cash.

Debt consolidation is a type of debt refinancing that can streamline your high-interest debts into one. These loans offer low rates to qualified borrowers, helping you to save time and money.

Our lending editors review the more than 120 debt consolidation loans on the market to find the best for low rates, minimal fees, flexible terms and more to help you find the most ideal fit for your debts and budget.

Our list includes providers that fit multiple needs and circumstances, including credit ratings across the spectrum.

8 best debt consolidation loans

Best for consolidation overall: Discover personal loans

Discover personal loans

Finder Rating: 4 / 5 ★★★★★

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Discover offers competitive rates, no origination fees and a simple debt consolidation process – earning it our best overall pick. Loans start at a relatively low 5.99% APR for the best credit borrowers, and it allows you to return funds within 30 days if you decide it's not the right choice for you. Discover offers loans from $2,500 to $35,000 with terms ranging from 36 to 84 months. But there's no grace period for payments and it charges a steep late fee if you miss your due date.
  • Available in all states

Best for student borrowers: Upstart personal loans

Upstart personal loans

Finder Rating: 4.15 / 5 ★★★★★

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Upstart boasts a “holistic” underwriting process, which means it considers more than just your credit score. Your education, work history and current employment all factor into the credit decision, making it a good match for students and borrowers with limited credit histories. Rates start relatively higher than some other lenders — but for a fair-credit option, it's not bad. And for high-cost credit card debt, you may still be able to save. Just know that Upstart may charge a high origination fee up to 10% of the loan amount, and there are only two repayment terms of either three or five years.
  • Not available in: West Virginia

Best for bad credit: Upgrade personal loans

Upgrade personal loans

Finder Rating: 4 / 5 ★★★★★

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Upgrade is a popular online lender offering flexible funding from $1,000 to $50,000. There's no minimum credit score to qualify and it offers APRs between 8.49% to 35.97% with repayment terms of up to 84 months. However, you'll be on the hook for an origination fee of 1.85% to 8.99%, largely determined by your credit score. And income requirements are strict — Upgrade requires a low DTI ratio and at least $1,000 of available income left over after monthly expenses. On the plus side, coborrowers are accepted, there are no prepayment penalties, and it offers rate discounts and payment deferment for up to two payments if you experience financial hardship.
  • Not available in: Colorado, Iowa, Maryland, Vermont, West Virginia
Partner terms and conditions

Personal loans made through Upgrade feature APRs of 5.94%-35.97%. All personal loans have a 2.9% to 8% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. Loans feature repayment terms of 24 to 84 months. For example, if you receive a $10,000 loan with a 36-month term and a 17.98% APR (which includes a 14.32% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $343.33. Over the life of the loan, your payments would total $12,359.97. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by Upgrade's lending partners. Information on Upgrade's lending partners can be found at https://www.upgrade.com/lending-partners/.

Best for comparing lenders: Monevo personal loans

Monevo personal loans

Finder Rating: 4.4 / 5 ★★★★★

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Monevo is a connection service — not a direct lender. When you fill out its online form, you can compare rates from its network of partners that offer loans for debt consolidation. It's ideal if you have a lower credit score and have struggled to find a lender willing to work with you. But as with all connection services, you could face marketing calls from its partners.
  • Available in all states

Best for credit card debt: FreedomPlus personal loans

Achieve personal loans

Finder Rating: 3.4 / 5 ★★★★★

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FreedomPlus is a top-rated lender, offering personal loans from $1,000 to $50,000 with rates from 7.99% to 29.99% APR. What makes it ideal for credit card debt consolidation is that you get a rate discount if FreedomPlus pays your creditors directly. This means if you qualify for its lowest rate of 7.99% APR, your rate could be reduced to 5.99% APR if it pays your creditors for you. Unfortunately, its loans come with an origination fee of 1.99% to 4.99% and it's not available in all 50 states.
  • Available in: Alabama, Alaska, Arizona, Arkansas, California, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Washington

Best for high loan amounts: LightStream personal loans

LightStream personal loans

Finder Rating: 4.83 / 5 ★★★★★

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Lightstream is a great choice if you want low rates and need a large loan. Loan amounts start at $5,000 and go as high as $100,000. Lightstream also doesn't charge origination fees, there's a high 0.50% interest rate discount for autopay and same-day funding is available. However, there's no soft-credit-check preapproval process — so expect a hit to your credit score when you apply. And you may need great to excellent credit to qualify.
  • Available in all states
Partner terms and conditions
*Payment example: Monthly payments for a $10,000 loan at 5.95% APR with a term of 3 years would result in 36 monthly payments of $303.99.

Truist Bank is an Equal Housing Lender. © 2020 Truist Financial Corporation. SunTrust, Truist, LightStream, the LightStream logo, and the SunTrust logo are service marks of Truist Financial Corporation. All other trademarks are the property of their respective owners. Lending services provided by Truist Bank.

Best for no fees and good credit: SoFi personal loans

SoFi personal loans

Finder Rating: 4.45 / 5 ★★★★★

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SoFi is known for low rates and no-fees personal loans, making them one of the less expensive debt consolidation options in the market. Loan amounts range from $5,000 to $100,000, with rates ranging from 7.99% to 23.43%. SoFi boasts no fees — no late fees, origination fees or prepayment penalties — so your APR is your rate. There's also a 0.25% rate discount for autopay. As a SoFi borrower, you gain access to great perks such as unemployment protection, college financial aid assistance and possible future rate discounts. However, know that SoFi tends to prefer good credit borrowers (680+), and loans may come with a long turnaround time.
  • Not available in: Mississippi
Partner terms and conditions
Fixed rates from 7.99% APR to 22.73% APR APR reflect the 0.25% autopay discount and a 0.25% direct deposit discount. SoFi rate ranges are current as of 6/15/22 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, income, and other factors. See APR examples and terms. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

Best for flexible repayments: Marcus by Goldman Sachs personal loans

Marcus by Goldman Sachs personal loans

Finder Rating: 3.8 / 5 ★★★★★

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Marcus by Goldman Sachs offers personal loan rates at 6.99% to 24.99% APR. There's also no origination fee, no late fees or prepayment penalties. Marcus pays your creditors directly if you're doing debt consolidation. As a bonus, you can defer a payment for a month with no interest after you've made 12 consecutive on-time payments. You have the option of choosing your payment due date, and you may change it up to three times over the course of the loan. But Marcus doesn't list any specifics when it comes to what you need to qualify.
  • Available in all states
Partner terms and conditions

Marcus By Goldman Sachs® Offer Terms and Conditions


Your loan terms are not guaranteed and are subject to our verification of your identity and credit information. To obtain a loan, you must submit additional documentation including an application that may affect your credit score. The availability of a loan offer and the terms of your actual offer will vary due to a number of factors, including your loan purpose, our evaluation of your creditworthiness, your credit history, if we have recently declined your loan application and the number of loans you already have with us. To obtain a loan, you must submit additional documentation including an application that may affect your credit score. Rates will vary based on many factors, such as your creditworthiness (for example, credit score and credit history) and the length of your loan (for example, rates for 36 month loans are generally lower than rates for 72 month loans). Your maximum loan amount may vary depending on your loan purpose, income and creditworthiness. Your verifiable income must support your ability to repay your loan. Marcus by Goldman Sachs is a brand of Goldman Sachs Bank USA and all loans are issued by Goldman Sachs Bank USA, Salt Lake City Branch. Applications are subject to additional terms and conditions. You may be required to have some of your funds sent directly to creditors to pay down certain types of unsecured debt. Receive a 0.25% APR reduction when you enroll in AutoPay. This reduction will not be applied if AutoPay is not in effect. When enrolled, a larger portion of your monthly payment will be applied to your principal loan amount and less interest will accrue on your loan, which may result in a smaller final payment. See loan agreement for details.

Methodology: How we choose the best debt consolidation lenders

Our lending experts review more than 120 personal loans on the market to narrow down the best for consolidating high-interest credit cards and other debt.

We update our best picks as the lending products change, disappear or emerge in the market. We also regularly review and revise our selections to make sure that our best provider lists reflect the most competitive offerings available.

Each lender is weighed across 11 key metrics:

  • Interest rates
  • Origination fees
  • State availability
  • Lender reputation
  • Credit score and eligibility requirements
  • Turnaround time
  • Range of products
  • Application process
  • Loan amounts
  • Term flexibility
  • Available discounts

Customer reviews, BBB accreditation and ratings were also considered.

Summary of best debt consolidation loans

LenderAPRBest forFinder ratingWhat sets it apart
Discover5.99% to 24.99%Overall★★★★★ Customer service team that specializes in credit card debt consolidation.
Marcus6.99% to 24.99%Good to excellent credit★★★★★ Limited fees and an APR as low as 4% for service members.
Upstart6.5% to 35.99%Fair credit★★★★★ Weighs cash flow more than credit score when determining your rate.
Upgrade8.49% to 35.97%Bad credit★★★★★ Offers greater payment flexibility and lets you defer two payments if you’re facing financial hardship.
FreedomPlus7.99% to 29.99%Paying off credit card debt★★★★★ Offers discounts if you have a coapplicant, are paying off debt or you have $40,000 in retirement savings.
LightStream5.99% to 23.99%Same-day funding★★★★★ Rate beat program and a hefty 0.5% autopay discount on top of competitive starting APRs.
Monevo1.99% to 35.99%Comparing lenders★★★★★ Works with a wide range of credit scores to find a good debt consolidation loan for your finances.
SoFi7.99% to 23.43%No fees★★★★★ Lack of fees and perks that come with being a SoFi borrower.

What is a debt consolidation loan and how does it work?

Debt consolidation loans are typically personal loans that combine two or more debts into a fixed rate loan with one monthly payment. A debt consolidation loan can help you manage your repayments and create a pathway out of debt.

When you apply, have a list of the accounts you want to consolidate and the payoff amounts. If approved, your lender will either pay off your creditors directly or transfer your funds into your bank account so you can pay off your creditors.

You can consolidate almost any unsecured debt, including credit cards, personal loans, medical bills or short-term loans like payday loans.

Most financial experts don’t recommend consolidating student debt. A better alternative to managing student debt may be student loan refinancing or federal loan consolidation.

When debt consolidation makes sense (and when it doesn’t)

Debt consolidation doesn’t reduce the amount of debt you currently owe — but it can reduce interest charges if you can get a lower interest rate, and make your monthly budget easier to manage.

Debt consolidation loans can make sense if …

  • You can qualify for a lower rate than what you’re paying across existing debts.
  • The debt consolidation loan has a monthly payment you can easily afford.
  • You want to simplify your finances.
  • You want to close some accounts but need to pay off balances first.
  • It will take you longer than two years to pay off your existing unsecured debt.

Debt consolidation loans may not make sense if …

  • You’ll pay more interest with the debt consolidation loan than if you were to keep your accounts separate.
  • You have poor credit and can’t qualify for a low interest rate on a personal loan.
  • You’re at risk of accumulating more debt after you consolidate.
  • You can pay off your existing unsecured debt in less than a year or two.

How to compare debt consolidation loans

If you’re consolidating to save money, then the debt consolidation loan’s APR is the most important factor. Your credit score is largely what determines the rates you qualify for. The majority of lenders offer starting rates around 5% to 7%, but they can get as high as 36%, depending on your credit score and the loan term you select.

Once you find some lenders that offer low rates, other features to compare include:

  • Prequalification. Most personal loan providers allow you to prequalify with a soft credit check to get estimated rate offers before moving forward with a harming hard credit check. It’s helpful to reach out to your creditors for payoff amounts, current interest rates and to find out your credit score before applying.
  • Extra fees. It’s common to see origination fees, which can get as high as 10% of the loan amount. Other fees can include late fees or prepayment penalties — but many lenders on our list skip those fees altogether, like SoFi and Marcus.
  • Pays creditors directly. Many lenders pay your creditors directly once funds go through, which is less work for you.
  • Discounts. Look for relationship discounts if you’re consolidating with your personal bank or credit union, student borrower discounts and autopay discounts. Many rate discounts are either 0.25% or 0.50%, and some lenders let you stack.
  • Lots of term options. Ideally, you want a short loan term because that means less interest charges over the course of the loan, but that also means a higher monthly payment. Look for lenders with multiple term options so you can choose the one that fits your budget.
  • Lender’s reputation. Take a quick look at some customer reviews and ratings to gain insight on how a lender handles customer service and how fast grievances are resolved. An overwhelming amount of complaints may be a sign to find another lender.
  • Hardship options and deferments. Some lenders allow you to defer a payment or two if you’re in a rough financial spot. Personal loans typically last at least two years, so it is worth knowing if a lender offers hardship plans in case something goes amiss.

Will debt consolidation hurt my credit score?

Whenever you apply for new credit, the lender is likely to do a hard credit check — which can drop your credit score between five to 15 points for 12 months, depending on your current credit score.

Aside from the hard credit check, there’s no other damage done. Your credit score is not harmed because you have a debt consolidation loan. Most debt consolidation loans are unsecured personal loans, so your credit report reflects that you have an active personal loan.

As a bonus, if you consolidate credit card debt, it can decrease your credit utilization ratio and improve your credit score. And if you make the consolidation loan payments on time, that is likely to also improve your credit score if the lender reports on-time payments to the credit bureaus.

Alternatives to a debt consolidation loan

If you think a personal loan to consolidate doesn’t quite your situation, check out these alternatives:

  • Consolidate with a credit card. You could do this with an existing credit card, or take on a new one. If you get a low intro rate credit card and pay off the balance before that introductory rate expires, it could mean big savings in interest.
  • Balance transfer credit cards. It’s what it sounds like — you move one or more debts onto a single balance transfer credit card to consolidate your debt.
  • Home equity products. Got a home with at least 20% equity? You could take on a home equity loan or home equity line of credit (HELOC) to consolidate your debt. Most home equity products are large, low-interest loans.
  • Cash-out refinance. Typically done on homes with at least 20% equity, a cash out refi is done by replacing your home’s current mortgage with a new, larger loan. The difference between your old mortgage and the new one is what you get to “cash out.”

How much can I save from consolidating?

If your debt consolidation loan has a lower rate than the average rate of the loans you’re consolidating, you could save money.

Here’s an example of a borrower with a few loans and the interest rate for each loan.

LoanDebt amountRate
Loan #1$2,00012%
Loan #2$6,20017%
Loan #3$7,50013.5%

A combined interest rate of those three loans is 14.49%. Check out the break down of the borrower’s total costs with and without a debt consolidation loan.

Total debt amountTotal interest rateMonthly payments and interest
Total cost of loans without consolidating debt$15,70014.49%
  • $432 across three monthly payments.
  • $5,078 in total interest charges over four years.
Total cost of loans using a debt consolidation loan$15,70010%
  • $398 monthly payment.

$3,413 in total interest charges over four years.

By consolidating, our borrower can save around $1,665 in interest charges and a lower monthly payment. Keep in mind that personal loans can come with other fees, such as origination fees, which can change how much you save (or don’t save!).

Compare debt consolidation loan providers

These providers also offer personal loans that you can use to consolidate unsecured debt.

1 - 6 of 6
Updated regularly
Name Product Filter Values APR Minimum credit score Loan amount
Bankrate
Bankrate
4.98% to 35.99%
Poor to excellent credit
$1,500 to $100,000
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Best Egg personal loans
Best Egg personal loans
8.99% to 35.99%
600
$2,000 to $50,000
A prime online lending platform with multiple repayment methods.
Go to site
More Info
Upstart personal loans
Upstart personal loans
6.5% to 35.99%
300
$1,000 to $50,000
This service looks beyond your credit score to get you a competitive-rate personal loan.
Go to site
More Info
Upgrade personal loans
Upgrade personal loans
8.49% to 35.97%
620
$1,000 to $50,000
Affordable loans with two simple repayment terms and no prepayment penalties.
Go to site
More Info
Happy Money
Happy Money
8.99% to 29.99%
640
$5,000 to $40,000
Pay down your debt with a fixed APR and predictable monthly payments.
Go to site
More Info
Monevo personal loans
Monevo personal loans
1.99% to 35.99%
300
$1,000 to $500,000
Quickly compare multiple online lenders with competitive rates depending on your credit.
Go to site
More Info
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Compare up to 4 providers

Recap of best debt consolidation lenders:

  1. Consumer Credit,Federal Reserve, October 7 2022

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