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Want to save money on interest while paying off your credit card debt? Consider a credit card consolidation loan.

Credit cards, while convenient, make it easy to get into and stay in debt. You may be able to reduce the interest and fees you’re paying across multiple credit cards by consolidating them into one account.

There are a few ways you can do this including a balance transfer, a debt consolidation loan, a personal loan or a peer-to-peer loan. You can learn more about your options in the guide below and decide which one is right for you.

Credible Personal Loans

Our top pick: Credible

Quickly get personal loan offers from top online lenders.

  • Minimum Loan Amount: $1,000
  • Maximum Loan Amount: $100,000
  • Loan Terms: 2–7 years
  • One simple form
  • Must have good to excellent credit

    How does credit card consolidation work?

    A credit card consolidation loan combines your outstanding balances on your credit cards into one monthly payment. The benefit is that you’ll pay off your existing debts with those credit card companies and have a simplified payment process with just one lender. You could possibly save on interest payments too, since credit cards tend to come with higher interest rates than personal loans do.

    Credit card consolidation could improve or hurt your credit depending on how you use it. Falling behind and making late payments on your credit cards may have damaged your credit, but consolidating them to one monthly payment could raise your credit score as your payment history improves. On the other hand, taking on a new loan, in general, could cause a short-term drop in your credit score because of the hard inquiry.

    Compare personal loans for credit card consolidation

    A selection of personal loans you can apply for

    Use this table to compare the interest rates, loan amounts and eligibility requirements of top online lenders.

    Rates last updated October 22nd, 2018

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    Unfortunately, none of the personal loan providers offer loans for that credit score. If you are in urgent need of a small loan, you might want to consider a short term loan.
    Name Product Product Description Min. Credit Score Max. Loan Amount APR
    Credible Personal Loans
    Get personalized rates in minutes and then choose a loan offer from several top online lenders.
    Good to excellent credit
    $100,000
    4.99%–36% (fixed)
    Upgrade Personal Loans*
    Affordable loans with two simple repayment terms and no prepayment penalties.
    620
    $50,000
    6.99% to 35.97% (fixed)
    Monevo Personal Loans
    Quickly compare multiple online lenders with competitive rates depending on your credit score.
    550
    $100,000
    3.09%–35.99% (fixed)
    Marcus by Goldman Sachs Personal Loans
    Consolidate your debt or pay off large expenses with competitive rates and no fees.
    Good to excellent credit
    $40,000
    6.99% to 24.99% (fixed)
    Even Financial Personal Loans
    Get connected to competitive loan offers instantly from top online consumer lenders.
    580
    $100,000
    4.99%–35.99% (fixed)
    LendingClub Personal Loan
    A peer-to-peer lender offering fair rates based on your credit score.
    660
    $40,000
    6.16% to 35.89% (fixed)
    Avant
    Conveniently check your loan options without affecting your credit score.
    580
    $35,000
    9.95%–35.99% (fixed)
    SoFi Personal Loan Fixed Rate (with Autopay)
    No fees. Multiple member perks such as community events and career coaching.
    680
    $100,000
    6.99% to 14.87% (fixed)
    OneMain Financial Personal and Auto Loans
    An established online and in-store lender with quick turnaround times. Poor credit is OK.
    Varies
    $30,000
    16.05%–35.99%* (fixed)
    NetCredit Personal Loan
    Check eligibility in minutes and get a personalized quote without affecting your credit score.
    550
    $10,000
    34%–155% (Varies by state) (fixed)
    CashUSA Installment Loans
    A connection service for quick cash loans up to $10,000.
    Bad credit OK
    $10,000
    5.99%–35.99% (fixed)

    Compare up to 4 providers

    A selection of brokers you can speak to

    One way to make sure you’re getting the best rate is to let a broker find a competitive rate for you.

    Rates last updated October 22nd, 2018
    Name Product Min. Credit Score Max. Loan Amount APR Product Description
    Credible Personal Loans
    Good to excellent credit
    $100,000
    4.99%–36% (fixed)
    Get personalized rates in minutes and then choose a loan offer from several top online lenders.
    Even Financial Personal Loans
    580
    $100,000
    4.99%–35.99% (fixed)
    Get connected to competitive loan offers instantly from top online consumer lenders.
    Monevo Personal Loans
    550
    $100,000
    3.09%–35.99% (fixed)
    Quickly compare multiple online lenders with competitive rates depending on your credit score.
    PersonalLoans.com Loan Connection Service
    580
    $35,000
    2.47% (As low as) (fixed)
    Access numerous lenders for peer-to-peer, personal installment and bank personal loans with repayment terms that work around your pay schedule.
     Lendvious Personal Loan Marketplace
    550
    $50,000
    4.99% (starting at) (fixed)
    Submit one form to prequalify with a selection of 15+ top online lenders.
    LendingTree Personal Loans
    640
    $50,000
    Varies by lender (fixed)
    Receive up to five loan offers in just minutes through LendingTree's simple online form.

    Compare up to 4 providers

    Credit card consolidation case study

    credit card consolidation case study image

    In other words, here’s what Matt’s credit card debt is like without consolidation if he only makes minimum monthly repayments:

    Credit card one Credit card two Both cards
    Balance and rate $4,500 at 19.99% APR $3,200 at 13.24% APR $7,700
    Minimum monthly repayment $90 $64 $154
    Total repayment $21,527 $6,304 $27,831
    Time it takes to pay off 43 years and one month 16 years and 8 months

    Here’s how much Matt saves if he takes out a $7,700 consolidation loan at 13.39% APR:

    Total repayment Time it takes to pay off Total savings
    $11,243 6 years $16,588

    What are your options for credit card consolidation?

    • Credit card balance transfer. Card providers usually offer 0% APR for a limited period of time, allowing you to pay off your debt. Keep in mind the card isn’t necessarily free when you factor in purchase APR and annual fees to consider.
    • Debt consolidation personal loan. You can take out a larger personal loan and pay off your credit card balances using the funds. Some lenders also give you the option of paying your creditors directly rather than you having to divvy up the funds yourself.
    • Peer-to-peer loans. Also referred to as P2P loans, these are becoming a popular choice for people looking to pay off their credit cards. Apply for a loan online and it will be funded by one or more “peer” investors.
    • Debt consolidation companies. These companies work by negotiating with your credit card providers to reduce your interest rate or lower your monthly repayments. You make a single payment and the debt consolidation company will distribute the payment across your card accounts.

    How can I decide which is the best consolidation method for me?

    • What’s your credit score? Whether or not you have good credit will affect the interest rate you’re offered by lenders as well as your chances of being approved. Make sure the rate you’re given will save you money when you consolidate your credit card debt.
    • How much debt do you have? The amount of debt you have may affect the credit you can apply for. Check the allowable limits on different accounts before you apply to ensure you can consolidate all of your debt. Other lenders may not be willing to take on your debt if it’s too large, so take this into consideration as well.
    • Do you want fixed repayments or would you prefer flexibility? Different consolidation methods offer different ways to repay. For example, if you opt for a P2P loan your payments will be fixed, whereas you can make variable payments and pay off more than you owe with a credit card.

    Balance transfer credit card vs. debt consolidation loan

    A debt consolidation loan and a balance transfer credit card are similar in purpose, but there are some key differences. The most obvious is that a loan generally has equal monthly payments while a balance transfer credit card has variable payments based on a percent of the balance owed.

    Balance transfer credit cards are used to transfer one or more high-interest amounts from a different provider. Typically these credit cards have promotional periods that generally last for 6 to 12 months and offer low or 0% APR. A balance transfer credit card’s usefulness is on a relatively tight timeline. After the promo period is up the APR reverts to the standard purchase rate, which can be 20% or more.

    Debt consolidation loans are also used to shift debt away from high-APR credit cards. Rather than taking advantage of a short-term promotional period, these are likely to have a lower APR than the non-promotional rate of a balance transfer credit card. A loan may be better when you want to pay your debt off over a longer period of time.
    Balance transfer vs. debt consolidation

    Compare balance transfer credit cards to consolidate debts

    Name Product Annual Fee Credit Score Min. Intro Balance Transfer APR Reward Value per Dollar Secured or Unsecured Introductory Balance Transfer APR APR (Annual Percentage Rate) for Purchases Annual Fee Minimum Credit Score
    680
    0%
    1
    Unsecured
    0% for the first 15 months (then 14.99% to 25.99% variable)
    14.99% to 25.99% variable
    $0
    Fair (660-699)
    Earn a $150 bonus statement credit after you spend $1,000 on purchases in the first 3 months. Rates & Fees
    680
    0%
    1.5
    Unsecured
    0% for the first 15 months (then 14.99% to 25.99% variable)
    14.99% to 25.99% variable
    $0
    Fair (660-699)
    Earn up to $250 back. Earn $150 back after you spend $1,000 or more in purchases with your new Card within the first 3 months of Card Membership. Plus, earn an additional $100 back after you spend an additional $6,500 in purchases within your first 12 months. You will receive the cash back in the form of a statement credit. Rates & Fees
    720
    0%
    Unsecured
    0% for the first 15 months (then to variable)
    13.99% variable
    $0
    Good (700-739)
    A low, variable APR on purchases, balance transfers and cash advances.
    95
    680
    0%
    1
    Unsecured
    0% for the first 12 months (then 14.99% to 25.99% variable)
    14.99% to 25.99% variable
    $95
    Fair (660-699)
    Earn $200 bonus cash back after you spend $1,000 on purchases in the first 3 months. Rates & Fees
    195
    0%
    1
    Unsecured
    0% for the first 15 billing cycles (then to variable)
    16.99% variable
    $195
    Enjoy unique excursions, privileged access to exclusive events and insider opportunities.
    495
    715
    0%
    1
    Unsecured
    0% for the first 15 billing cycles (then to variable)
    16.99% variable
    $495
    Good (700-739)
    Mastercard Black Card members receive an annual $100 air travel credit toward flight-related purchases including airline tickets, baggage fees, upgrades and more.
    680
    0%
    1
    Unsecured
    0% for the first 15 months (then 14.99% to 25.99% variable)
    14.99% to 25.99% variable
    $0
    Fair (660-699)
    Earn 10,000 Membership Rewards® Points after you use your new Card to make $1,000 in purchases in your first 3 months.
    680
    0%
    Unsecured
    0% for the first 15 months (then 16.74% to 25.49% variable)
    16.74% to 25.49% variable
    $0
    Fair (660-699)
    Jumpstart your financial fitness! 60 day introductory balance transfer offer, save on interest, and get your free monthly credit score.
    680
    0%
    Unsecured
    0% for the first 15 statement closing dates (then 14.99% to 24.99% variable)
    14.99% to 24.99% variable
    $0
    Fair (660-699)
    Transfer high rate balances and save on interest with an Introductory $0 balance transfer fee for the first 60 days your account is open. After that, the fee for future balance transfers is 3% (min. $10).
    690
    0%
    1.5
    Unsecured
    0% for the first 15 months (then 16.74% to 25.49% variable)
    16.74% to 25.49% variable
    $0
    Fair (660-699)
    Earn unlimited 1.5% cash back on every purchase - it's automatic. No minimum to redeem for cash back.
    720
    0%
    1
    Unsecured
    0% for the first 12 statement closing dates (then 15.24% to 25.24% variable)
    15.24% to 25.24% variable
    $0
    Good (700-739)
    Earn more cash back for the things you buy most.
    NASA Federal Platinum Advantage Rewards Credit Card
    NASA Federal Platinum Advantage Rewards Credit Card
    680
    17.99%
    1
    Unsecured
    17.99% for the first 90 days (then 11.65% to 17.99% variable)
    11.65% to 17.99% variable
    $0
    Fair (660-699)
    Enjoy perks and save money while gaining points that never expire with every purchase.
    620
    Secured
    13.25% variable
    $0
    Poor (Below 660)
    A great way to establish or improve your credit history.
    300
    10.99%
    1
    Secured
    10.99% for the first 6 months (then to variable)
    24.99% variable
    $0
    Poor (Below 660)
    2% Cashback at restaurants or gas stations on up to $1,000 in combined purchases each quarter. Plus 1% cash back on all other credit card purchases.
    24
    580
    Secured
    25.74% variable
    $24
    Poor (Below 660)
    Build, or rebuild, your credit with each purchase.
    35
    350
    Secured
    11.65% to 21.65% variable
    $35
    Poor (Below 660)
    Get a card that can help you build credit. Determine your own credit limit. When you apply, you'll open a two-year certificate of deposit (CD) with $250 to $5,000. The balance of your CD is your credit limit.
    35
    350
    Secured
    11.65% to 21.65% variable
    $35
    Poor (Below 660)
    You can get travel benefits (no foreign transaction fees), retail benefits and collision damage waiver coverage on your rental car.
    650
    Unsecured
    26.99% variable
    $0
    Poor (Below 660)
    Enjoy no annual fee, plus access to valuable benefits.

    Compare up to 4 providers

    How can I find the best credit card consolidation loan?

    First, get a ballpark idea of how much you need to borrow by adding up your credit card balances. Many lenders have limits to how much debt they’re willing to consolidate, so knowing this ahead of time can help you find a lender that offers what you need. You can do this using our debt consolidation calculator, which can also show you how much you might save by consolidation.

    To find the best deal available to you, shop around — you can get started by using our comparison table. Take into consideration features like the minimum and maximum loan amounts, APR range, fees and turnaround time before you apply. You might want to also take a look at online reviews from vetted sites like Trustpilot and the Better Business Bureau to look out for any red flags.

    Once you’ve narrowed it down to a few choices, consider prequalifying with a few lenders to see which can offer you the best deal. Your rates and terms might not be exactly what you’d get with the lender, but it’s more specific than a general range of loan amounts.

    How to avoid scams

    • Research. Make sure the lender is accredited and licensed to do business in your state. License numbers should be visible in the footer of the website and in the Terms and Conditions.
    • Stay away from “guaranteed approval.” Lenders can’t guarantee that you will qualify for a loan without knowing your particular situation and personal information.
    • No upfront fees. Be wary of having to pay any fees to apply for a debt consolidation loan, you should never have to with a legitimate lender.
    • Take note of initial contact. You should always be the one to initiate contact, unreliable lenders are more likely to be insistent in their search for borrowers.
    • Beware of companies claiming to offer loan debt consolidation. Many of the companies that advertise this way instead offer debt management and settlement services.

    How to avoid a personal loan scam

    When should I hold off on consolidation?

    Consolidating your credit card debt isn’t always the right move. Consolidate at the wrong time and you could actually lose money. You might want to hold off on consolidating or consider other options when:

    • You qualify for a higher APR. This is a red flag that your personal finances are not strong enough to handle a new loan, even if it’s a debt consolidation loan. You might actually end up losing money if the new APR is high enough.
    • You’re about to get another loan. Lenders run a hard credit check that temporarily hurts your credit score when you apply for a loan. So, if you have plans to buy a new house, car or even get funding for your small business you might not qualify for the most competitive rate if you recently took out a debt consolidation loan.
    • Your debt is more than half your income. In this case, you likely won’t be able to qualify for a debt consolidation loan from a reputable lender. Instead, you might want to consider other options like signing up for credit counseling.

    Pros and cons of credit card debt consolidation

    Pros

    • Fewer payments to keep track of. By rolling several different balances into one you should be able to manage your repayments easier.
    • Fixed terms. A fixed term means you can’t get away with paying the minimum and ignoring your balance. Consolidation can put you on the path to debt freedom.
    • Improve your credit. Taking on a new type of credit, paying down your credit card balance and making on-time repayments all have positive effects on your credit score.
    • Potentially lower rates. Credit cards typically have higher APRs than personal loans, meaning that you can save.

    Cons

    • It doesn’t wipe out your debt. Debt consolidation is only useful in some situations. If you can’t get a lower rate or qualify for affordable repayments, debt consolidation won’t do you much good.
    • You could pay more in interest. A lower rate can help, but if you sign up for a long-term loan to get the lowest monthly repayments, you could actually end up paying more in interest.
    • It doesn’t fix bad habits. In the end, debt consolidation doesn’t get to the source of the problems: Credit card spending. In addition to debt consolidation, you might want to learn how to budget or consult a financial advisor to help you stay on track.
    • You could lose some assets. If you decide to back your loan with collateral, you risk losing that if you’re unable to pay off the loan.

    5 tips to beat the credit card debt trap

    Debt tends to stick around once you’ve picked it up. Use these tips to avoid getting into debt in the first place.

    1. Only spend what you have. Spending more money than you know you can pay back in the near future can make your credit card balance balloon. Make sure to reduce your spending during the next billing cycle to pay off any months that you drop more cash than you have. Can’t resist the temptation? You might be better off sticking with a debit card.
    2. Avoid interest. Pay off your credit card balance in full each month. The longer you take to pay off your balance, the more difficult — and expensive — it becomes thanks to mounting interest.
    3. Don’t spend everything you earn. Spending your last dollar can leave you vulnerable to piling on debt. Make and stick to a monthly budget to help manage your money.
    4. Save up. Unexpected expenses could come along and hurl you into a pile of debt. Be prepared by cutting out room in your budget to make a deposit into a high-interest savings account each month.
    5. Pay your bills on time. Protect your credit score by never being late on payments. You may need to get another credit card — or take out a loan — in the future, you can get lower, less risky interest rates.

    Bottom line

    Once you’ve decided to consolidate your debt you’ll need to choose the best way to do so based on your financial situation. Your plan to financial freedom can be supported by consolidation tools, but they need to be used well. Take your time and compare providers once you’ve narrowed down what you want to use. Doing so will help you get the most out of your consolidation and get you on your way to fully overcoming your debt.

    Have more questions to ask before you consolidate your credit card debt?

    Aliyyah Camp

    Aliyyah Camp is a publisher for finder.com helping folks compare personal, student, car and business loans. When she's not helping people with their personal finances, you can find her going for runs outdoors.

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