The Best Personal Loans For Debt Consolidation

If you’re struggling with debt and want to find the best personal loans for debt consolidation, it can be hard to find the right lender if you don’t know what to look for. 

What are the features you should look out for in a personal loan consolidation company? How do you choose the right loan? And how do you get out of debt once and for all?

7 Ways To Save On Interest

Credit card debt is on a lot of people’s minds these days. The average household with credit card debt owes $15,762, and 17% of consumers are severely behind on their payments. 

That’s not something to joke about. While bankruptcy can be an option for some, others want to explore ways to pay off their debt without damaging their credit scores or adding any new stressors in their lives. 

One way that can help is personal loan consolidation—but you need to be careful! Here are 7 tips for getting low-interest debt consolidation loans through personal loan consolidation

How Do I Choose?

When you’re looking for a personal loan, it’s important to shop around and understand what options are available. 

Interest rates and term lengths can vary widely, so it’s a good idea to check out personal loans from multiple lenders before choosing one. 

A lender offering low-interest debt consolidation may not have much flexibility on terms, but if you don’t have much money or assets to back up your loan, having some protection is critical. 

If you’re applying for a personal loan in order to consolidate credit card debt, make sure that any loan you choose will cover as many cards as possible without overloading your debt-to-income ratio. 

The more credit cards your personal loan covers, the less likely you are to fall behind on payments.

Which Is Better – A Balance Transfer Or Personal Loan?

Many people wonder if there’s a difference between getting a balance transfer or a personal loan to consolidate credit card debt. 

The answer is: it depends. A balance transfer, where you get one low-interest rate on all your debt in exchange for paying a small fee or interest rate, isn’t ideal when you have high-interest rates on your cards and don’t want to make monthly payments on balances (which can lower your credit score). 

A personal loan, however, gives you complete flexibility to pay off what you want when you want.

How Much Can I Borrow?

Debt consolidation allows you to borrow a larger sum of money, which can help you pay off your debts quicker. 

However, lenders have their own debt-to-income ratios that determine how much they’ll lend you. In order to avoid getting turned down for credit card debt consolidation, check out our step-by-step guide on how to get approved for a personal loan. 

It will walk you through every step of applying for a personal loan, from gathering your financial information to writing up a repayment plan. 

Our guide also includes tips and advice on how to improve your chances of approval by focusing on your credit score and identifying other assets or income sources available to use as collateral.

What’s My Credit Score Needed?

In order to qualify for low-interest debt consolidation loans, your credit score should be at least 680. If your score is over 700, you have even more options open to you, including a free debt consolidation service that won’t require any personal guarantee. 

Higher scores also make it easier to qualify for lower interest rates and get approved for larger loans that can finance larger debts. 

Your credit score also determines how much interest you’ll pay. In general, people with higher scores pay less interest than those with lower scores (i.e., 600 vs 630). On average, someone with a poor credit score pays double what someone with a good credit rating plays in interest alone each year (source: Experian).

Should I Borrow From Family Or Friends?

The prospect of taking out a personal loan to consolidate your credit card debt may make you feel anxious. 

Many people wonder whether or not it's appropriate to borrow from family or friends for low-interest debt consolidation. 

The best advice is to avoid borrowing if you can, but also realize that if you do end up in a situation where you need help, it's important to proceed with caution. 

Keep these tips in mind when considering how to go about finding funding for your personal loan consolidation.

Ten Steps To Consolidating Your Debt Without Getting Stressed Out

What most people don’t realize is that they have options when it comes to consolidating their debt. Many credit card companies offer personal loans with incredibly low interest rates, which means you can reduce your monthly payment and pay off your debt faster. 

At LoanSafe, we recommend using a personal loan for credit card consolidation as opposed to a traditional mortgage or home equity loan. 

The interest rate is typically much lower and it’s easier to qualify for a personal loan than it is for many other types of financing. 

If you are considering refinancing your home or taking out a second mortgage, make sure you check out our list of recommended lenders; we personally vet all of them before adding them to our directory.

The Best Personal Loans For Debt Consolidation