Compare debt consolidation loans for good credit

Advantages of consolidating debt with a good credit score

A good credit score can net you some of the most lucrative rates on consolidation loans, plus grant you access to coveted balance transfer credit cards featuring 0% promotional APRs. Since debt consolidation rolls your existing debts into a single payment, a consolidation loan or balance transfer credit card can save you more money than if you paid your debts individually.

Should I get a balance transfer card or a loan when I have good credit?

Both are suitable options for people with good credit. Balance transfer credit cards often offer low or no APR for a period of time on the debt you transfer to the card. Banks, credit unions and online lenders offer personal loans to pay off debt, often with competitive, low rates.

Balance transfer credit cards

Balance transfer credit cards can offer competitive rates on your transfer. Many cards offer a lengthy 0% APR intro period, saving you on interest while you pay down your debt. This could be a solid option if you have debt on multiple credit cards with high APRs. But you generally can’t transfer debt between cards with the same provider — like between two Chase cards.

Debt consolidation loan

To qualify for a debt consolidation loan, you'll typically need a low debt-to-income ratio in addition to having good credit. Your interest rates and loan amounts are based on your creditworthiness, meaning you're looking at ideal terms if you have good credit.

Debt consolidation loan vs. balance transfer credit card

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Name	Product	Amount saved	Balance transfer APR	Balance transfer fee	Minimum Credit Score	Filter values
Applied Bank® Secured Visa® Gold Preferred® Credit Card			N/A		300		No credit check is required for this secured card. Make a deposit of at least $200 to open this card and get a low 9.99% fixed APR on purchases.	Apply now View details	Compare	loading Fetching your data…
Surge Secured Mastercard®			N/A		300		Earn 1% cash back rewards.	Apply now View details	Compare	loading Fetching your data…
Self Visa® Credit Card			N/A		300		Build your credit with a low minimum security deposit of $100 and no credit score required.	Apply now View details	Compare	loading Fetching your data…
OpenSky® Secured Visa® Credit Card			N/A		300		Apply for this card with no credit check if you're new to credit or have bad credit.	Apply now View details	Compare	loading Fetching your data…
PCB Secured Visa®			N/A		300		Choose your initial deposit amount and credit limit from $200 to $1000. Rates & fees	Apply now View details	Compare	loading Fetching your data…
Assent Platinum 0% Intro Rate Mastercard® Secured Credit Card			N/A		300		A rare secured card with a 0% intro APR on purchases for 6 months, followed by 12.99% variable.	Apply now View details	Compare	loading Fetching your data…
First Progress Platinum Select MasterCard® Secured Credit Card			N/A		300		No minimum credit score and no credit history required.	Apply now View details	Compare	loading Fetching your data…
First Progress Platinum Prestige Mastercard® Secured Credit Card			N/A		300		Build or rebuild your credit with this secured card.	Apply now View details	Compare	loading Fetching your data…
First Progress Platinum Elite MasterCard® Secured Credit Card			N/A		300		Build your credit with all three major credit bureaus.	Apply now View details	Compare	loading Fetching your data…

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How do I compare options?

Review your circumstances — financial and otherwise — before choosing the best option. Consider the following:

• Your total debt. If your debt is particularly high, there might not be a consolidation loan available that can cover the cost of all of your debts. In this case, you might split your options between a loan and a balance transfer card to get a lower rate.
• Potential fees. While balance transfer cards can offer 0% intro APRs, some charge transfer fees that depend on your transfer amount. Consolidation loans generally charge an origination fee or flat fee — often a percentage of the amount you're borrowing.
• Your repayment plan. Both balance transfer cards and loans offer limited terms, so planning your monthly payments accordingly can get you out of debt before your term is up. Failure to make your payments on time can cost you fees and could end a balance transfer card's promotional period.

Which option is better for my credit score?

It's understandable to be concerned about how consolidating your debt could affect your credit, especially when you have a good credit score to maintain. Applying for both consolidation loans or balance transfer cards can affect your credit, though not always negatively. Consider:

• Hard inquiries. Applying for a card or loan often results in a hard inquiry. This can hurt your credit in the short term, though usually for no longer than a year.
• Credit utilization. Paying off several of your credit cards can improve your credit score by lowering your credit utilization. Closing these accounts, however, could negatively affect your credit, since your overall utilization rate will go up.
• Your credit mix. Having various types of credit open helps your overall credit score. If all your debt comes from credit cards, a consolidation loan can improve your credit score.
• On-time payments. Making payments on time is essential for your credit score. Missing even one payment on your new account could harm your credit.

How can I consolidate debt without hurting my credit?

To consolidate without hurting your credit, make on-time payments and have a clear idea of your payoff date. Additionally:

• Focus on your new loan. Opening new accounts or continuing to use existing ones can quickly get out of hand after you've consolidated. Avoid overextending and focus on paying off your consolidated debt.
• Pay during your intro period. If you qualify for a balance card with a 0% APR intro period, try paying off your debt in full before the end of the period.
• Do the math. While debt consolidation can make your repayment easier, make sure the cards or loans you qualify for will actually save you money in the long run.

Bottom line

If you have good credit, debt consolidation can help you pay off your debts faster while saving on interest. Compare balance transfer cards against your options for consolidation loans to find the best solution for you.

Frequently asked questions

Does transferring credit card balances affect my credit score?

Applying for a balance transfer card typically requires a hard inquiry on your credit, which can negatively affect your score. This is also the case when applying for consolidation loans.

Does transferring a balance close the account?

No. Unless you specifically close an account after paying off your balance, your credit card will stay open.

Can I use my credit card after debt consolidation?

You can, but the purchase APRs are often high and you could accumulate more debt on top of what you're trying to pay off.