Best Personal Loans for Debt Consolidation
August 23, 2018
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If you’re like many Americans, you are dealing with debt that makes your life harder than it should be. Your debt problem may be the result of credit cards, personal loans, expensive car payments, or medical bills. Whatever debts are plaguing your finances, they are likely standing between you and your best life. After all, who wants to spend their “extra” income making huge payments toward debt every month?
Fortunately, there is a way out of debt if you’re willing to do the work. If you cut your spending, learn to live on a budget, and throw your extra funds toward your debts each month, you can pay down debt and gain your freedom faster.
A personal loan for debt consolidation can also help expedite the process provided you can qualify for a lower interest rate than you’re paying now. Consolidating your debts into a single loan with one monthly payment can also simplify your debt payoff process and make keeping up with your bills that much easier.
5 Personal Loan Companies to Consider for Debt Consolidation
If you want to get out of debt this year and know a personal loan could help, it’s smart to compare loan companies to see what they can offer. The following services offer personal loans with low rates that could help you save money on interest, pay down debt faster, and simplify your financial life:
PrimeRates.com is a personal loan aggregator that focuses its efforts on helping consumers consolidate high interest debt into new loans with lower rates and better terms. This company connects consumers with personal loans of up to $5,000 with interest rates than can be as low as 5.96% APR depending on your creditworthiness.
It’s important to note, however, that PrimeRates.com doesn’t offer these loans on its own. Instead, it allows consumers to fill out one loan application to see multiple offers from various lenders in the personal loan space. This allows you, the user, to compare offers to find the right loan for your needs.
If you’re looking for a loan aggregator who offers debt consolidation loans to a wide range of clients, also check out EVEN Financial. This lending marketplace offers loans that range from $1,000 to $100,000 with interest rates that can be as low as 4.99% APR depending on your creditworthiness.
Applying for a personal loan with EVEN Financial is easy since you can go through the entire process online. Repayment terms are offered for up to 84 months, and you can secure a personal loan through online lenders such as best egg, SoFi, LendingPoint, Lending Club, and Prosper.
LifeLoans is yet another lending marketplace that lets you compare personal loans from multiple companies with a single loan application. This company focuses on loans between $100 and $40,000 with competitive interest rates. These loans are also available for consumers with all credit ratings, although interest rates will be higher for those who suffer from poor credit.
One benefit touted by LifeLoans is the fact you can get loan funds deposited in your account fairly quickly. According to the company, you may be able to get your funds deposited as fast as the next business day.
SignatureLoan.com promises to connect borrowers with lenders that offer personal loans in amounts up to $35,000. This company offers a seamless online application process with an e-signature required at the end. Loan terms are available from 90 days to 72 months, and collateral is typically not required.
Interest rates on loans offered through the platform can be as low as 5.99% depending on your creditworthiness. You can also rest assured that your personal details will be safe before, during, and after the loan process thanks to their fully encrypted website and security detail.
Finally, don’t forget to check out ZippyLoan before you apply for a personal loan for debt consolidation. This lender connects consumers with personal loans in amounts of up to $15,000 with just a five-minute online application process required.
All credit types are accepted, which means it may be possible to qualify for this loan if your credit is poor or fair. Repayment terms are offered for up to sixty months - or five years - and you could get your funds as soon as the next business day.
Why Consolidate Debt?
If you have high interest revolving debt you’re struggling to pay off, consolidating that debt into a new loan with a lower rate can help. Here’s how:
Imagine you have $10,000 in credit card debt on a rewards credit card with an interest rate of 19% APR. If you made a monthly payment of $200 per month with this rate, it would take you nine years to pay your balance down. And, thanks to your high interest rate, you would pay $9,971 in interest during that time for a total repayment amount of $19,971.
Now imagine you took steps today to consolidate your debt into a new personal loan. If you were able to secure an APR of 5.99% and made the same $200 payment each month, you could become debt-free in only five years. During that time, you would pay only $1,533 in interest for a total repayment amount of $11,533.
In this scenario, a debt consolidation loan would save this consumer over $8,000 and four years of monthly payments.
The Bottom Line
If you’re struggling with debt and tired of making slow progress, a debt consolidation loan may be exactly what you need. Securing a lower interest rate will help you save money over the long haul, and this could help you pay down debt faster if you paid the same amount each month.
Also make sure to explore balance transfer cards that offer 0% APR for a limited time. These cards can help you pay down debt without any interest for up to 18 months, and some even come without balance transfer fees.