Debt Consolidation

Best Debt Consolidation Loans

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Updated: Oct. 23, 2018

A debt consolidation loan can be a useful vehicle for organizing outstanding debts and reducing costs, but the usefulness of this approach comes down to the details. The cost-effectiveness of a debt consolidation loan depends on the rates and repayment terms available, and the availability of this option depends on your ability to get approved for a loan.

To help you find the best options for debt consolidation loans, LendingTree analyzed lending requests for the month of September 2017 to determine two things: which lenders provided the lowest annual percentage rates (APRs) and which closed the most loans during the period. Since the best-performing lenders varied according to different credit score levels, LendingTree grouped the results in four categories: excellent credit (a score of 750 or higher), good credit (700-749), fair credit (650-699) and poor credit (below 650).

Based on this analysis, the table below shows the top two lenders in each of the four credit categories. Note that rates and loan terms are subject to change at any time, as is performance relative to other lenders and lending platforms.

Best Debt Consolidation Loans
Lender/Online Lending PLatform Credit Category Best Performing Credit Score Range Origination Fees Loan Amounts Overall APR Range Length
Marcus by Goldman Sachs® Excellent 750+ No origination fee $3,500–$40,000 6.99%–19.99% 36 to 72 months
LightStream Excellent 750+ No origination fee $5,000–$100,000 3.99%
19.99% with autopay
24 to 144 months
Discover Bank Good 700 – 749 No origination fee $2,500–$35,000 6.99%–24.99% 36 to 84 months
FreedomPlus Good 700 – 749 1.99% - 4.99% $7,500–$40,000 7.99%–29.99% 24 to 60 months
Upgrade Fair 650 – 699 2.90% - 8.00% $1,000–$35,000 7.99%–35.97% 36 or 60 months
Best Egg Fair 650 – 699 0.99% - 6.99% $2,000–$35,000 5.99%–29.99% 36 or 60 months
LendingClub Bad Below 650 2.00% - 6.00% Up to $40,000 10.68%–35.89% 36 or 60 months
Avant Bad Below 650 Up to 4.75% $2,000–$35,000 9.95%–35.99% 24 to 60 months

By “best-performing”, we mean that borrowers in these credit bands (excellent, fair, poor, etc) scored loans with the lowest interest rates with these lenders. Keep in mind lenders are willing to work with people with a variety of credit scores, so just because a lender is in our “excellent credit” category does not necessarily mean they won’t work with people with lower credit scores. It just means that based on our data from LendingTree’s personal loan marketplace, we found that people in these credit score bands got the lowest

Best debt consolidation loans for excellent credit (750+)

●    Marcus by Goldman Sachs®

This is an arm of the venerable Wall Street investment banking firm whose history goes back 148 years. Whereas Goldman Sachs Bank USA has historically catered primarily to high-net-worth and institutional clients, Marcus is geared specifically towards the needs of retail banking customers.

Marcus offers high-yield savings accounts and loans, with an emphasis on debt consolidation loans. With respect to those loans, their niche can be described as lending to people who have run up enough debt that they need to reduce interest rates and organize those debts, but who are not so burdened with debt that they have damaged their credit history.

In that vein, Marcus specializes in unsecured loans to people with good credit. Their loans have no origination fees, which means borrowers can get a debt consolidation program underway without having to take a step back financially before moving forward. Their loan rates are fixed, making monthly payments predictable and manageable. Borrowers can apply either online or via a paper application, and the Marcus website has a handy tool that allows borrowers to adjust the target loan amount and desired monthly payments before seeing loan options.

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 and our evaluation of your creditworthiness. 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.

●    LightStream

LightStream is a division of SunTrust Bank, a financial institution with over 1,000 branches concentrated in the southeastern United States. LightStream is dedicated to providing an online lending platform for consumers throughout the country.

LightStream offers an extraordinary range of both loan amounts and repayment periods, giving consumers an unusually detailed ability to customize their loans to their needs. Their website clearly lays out a table of loan options based on the purpose of the loan you specify.

Loans from LightStream have no origination fees, and their low-end rates are very competitive. However, be advised that your annual percentage rate will be 0.50 percentage points higher if you do not use their auto-pay feature.

Like many online lenders, LightStream tries to use speed to appeal to potential borrowers, offering same-day approval and funding in some cases. They also offer two noteworthy programs that show their confidence in their lending process and products.

One such program is their Loan Experience Guarantee, which offers people who borrow through LightStream a $100 rebate if they are not satisfied with the borrowing process. The other unique program LightStream offers is their Rate Beat Program, which promises to beat any other rate for a comparable loan by at least 0.10 percent. Terms may apply.

*Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay are 0.50% points higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice. Payment example: Monthly payments for a $10,000 loan at 3.99% APR with a term of 3 years would result in 36 monthly payments of $295.20.

Compare Loan Rates for Excellent Credit

By clicking “Compare Personal Loan Rates for Excellent Credit”, you may or may not be matched with any lender mentioned in this article. Based on your creditworthiness, you may be matched with up to five different lenders in our partner network.

Best debt consolidation loans for good credit (700-749 )

●    Discover Bank

Discover is a well-known credit card company, but some may not realize that it is also a full-fledged bank, offering checking accounts, savings accounts, loans, and more. Among the different types of loans offered by Discover Bank are personal loans.

Discover’s personal loans have a fixed interest rate and term. One factor that makes them attractive to customers is they there is no origination fee or any other fee for getting a personal loan with Discover, as long as you always pay on time.

After you apply for a Discover personal loan, you could get your decision back within minutes and if approved, receive funds the next business day. They also offer a 30-day money-back guarantee. This means you have 30 days after your loan is funded to cancel and return the funds if you’re not satisfied. If you do this, you will not be charged any interest and the loan will be canceled.

The APR ranges from 6.99% to 24.99% APR based on creditworthiness at time of application. Loans up to $35,000. Fast & Easy Process. Terms are 36 to 84 months. No prepayment penalty. This is not a firm offer of credit. Any results displayed are estimates and we do not guarantee the applicability or accuracy to your specific circumstance. For example, for a $15,000 loan with an APR of 10.99% and 60 month term, the estimated monthly payment would be $326. The estimated total cost of the loan in this example would be $19,560.

●    FreedomPlus

Freedom Plus is an online personal loan lender that is affiliated with the Freedom Financial Network.

Freedom Plus loans are available with rates as low as 7.99%. But in order to qualify for this low interest rate, their website states  that “a borrower will need excellent credit on a loan of $15,000 with a term of 24 months, and qualify for at least two of the following discounts: (1) add a co-borrower who has sufficient income; (2) use at least fifty percent of the loan proceeds to directly pay off existing debt; or (3) show proof of having at least forty-thousand dollars in retirement savings.”

The APR you receive on your loan includes all loan fees, including the origination fee, which may be between 1.99% - 4.99%.

Freedom Plus also uses speed to appeal to customers, stating that same day loan decisions are available and if approved, the funds can be in your account within 48 hours. They also state that the only information necessary to apply is your signature, a valid ID, and verified income and bank account.

Compare Loan Rates for Good Credit

By clicking “Compare Personal Loan Rates for Good Credit”, you may or may not be matched with any lender mentioned in this article. Based on your creditworthiness, you may be matched with up to five different lenders in our partner network.

Best debt consolidation loans for fair credit (650 – 699)

●    Upgrade

Upgrade is a lending platform designed by two co-founders of LendingClub, with the focus of the Upgrade platform being on giving consumers a convenient credit management resource. Toward this end, Upgrade offers both personal loans and credit monitoring.

In keeping with the goal of convenience, Upgrade offers a one-page application process. This will generate a series of loan options for you, specifying the length and rate for each possibility. If you choose one of these options, Upgrade promises to have the loan proceeds transferred to your bank within a day of completing its verification process.

Continuing on the theme of convenience, Upgrade allows you to automate payments from your bank account, and even lets you pick the due date cycle. So, for example, you could coordinate payments with the timing of your wages or other income.

On the downside, this convenience may come at a bit of a price. Upgrade charges origination fees that may be anywhere in a range of 2.90% - 8.00%, so if your fees are in the higher end of that range it would add considerably to the cost of your loan.

Personal loans made through Upgrade feature APRs of 7.99%-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. 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. Accept your loan offer and your funds will be sent to your bank or designated account within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes the transaction. From the time of approval, funds should be available within four (4) business days. Funds sent directly to pay off your creditors may take up to 2 weeks to clear, depending on the creditor. Personal loans issued by Upgrade's lending partners. Information on Upgrade's lending partners can be found at

●    Best Egg

Best Egg is an online lending platform that matches borrowers with investors who are willing to loan money in order to earn interest on those loans. This type of investor-funded lending is often a viable choice for borrowers with less-than-ideal credit histories.

Best Egg’s value proposition is that they can speed the process of matching borrowers with investors by having already lined up investors who are ready to fund loans that meet certain parameters. Thus, like many online lenders, Best Egg is able to offer not only a streamlined application process but also funding within one business day in some cases.

While the low-end of Best Egg’s rate range is very competitive, borrowers should take care to ascertain the specific rates that would apply to them before committing. That is sound advice when working with any lender, but it is particularly relevant with Best Egg because they have such a wide range of loan terms.

For example, origination costs from Best Egg can be anywhere from 0.99% - 6.99%. At the high end that is unusually expensive, and contributes to the rather pricey high end of the APR range offered by Best Egg, which spans from 5.99% to 29.99%¹.

Another condition that depends greatly on your circumstances is that while Best Egg offers an overall loan amount range of $2,000 to $35,000.

Compare Loan Rates for Fair Credit

By clicking “Compare Personal Loan Rates for Fair Credit”, you may or may not be matched with any lender mentioned in this article. Based on your creditworthiness, you may be matched with up to five different lenders in our partner network.

Best debt consolidation loans for bad/ poor credit (Below 650 )

Note: If you have a credit score less than 640, struggling to make monthly debt payments and would like to explore your options to reduce your debt by up to 50%, then please click our option to customize a personal debt relief plan.

Customize Your Debt Relief Plan Today

●    LendingClub

LendingClub has been a pioneer in peer-to-peer lending, which involves using a technology platform to match borrowers with investors who fund their loans. In particular, this has become a viable option for borrowers with poor credit records, who might not be able to meet the underwriting standards of a traditional bank.

The process at LendingClub involves a soft credit check, which is one that won’t affect your credit score. Based on that, you will receive loan offers that you can decide whether or not to accept. The offers available from LendingClub are more limited than from many other lenders, with loans available only in lengths of 36 or 60 months.

Another apparent limitation of LendingClub is that they advertise their process as taking seven days, compared with the one-day turnaround offered by some other online lenders. However, since debt consolidation should be part of a long-term budget discipline rather than a snap decision, this timing difference should not be too big a problem.

What may be more of an obstacle at LendingClub is the cost, because the upper end of their APR range is very high. This is partially due to their high origination fees, which range from 2.00% - 6.00% but average 5.49%. Peer-to-peer lending may be the only option available to people with poor credit records, but you should think carefully whether it would actually represent savings in the long run.

>> To learn more about debt consolidation loans for bad credit click here

●    Avant

Avant offers access to fixed-rate, unsecured debt consolidation loans, as well as home improvement and emergency loans. Their stated goal is to use analytics to lower barriers and reduce costs in online lending, but with an APR range that can go as high as 35.99%, whether or not they actually succeed in lowering costs would appear to depend very much on the terms you are offered.

Avant allows you to choose a term of 24 to 60 months, so you can structure your loan to minimize long-term costs (which would involve a shorter loan) or minimize monthly payments (which would involve a longer loan).

One thing that undermines the more cost-effective approach of a shorter loan is that Avant’s origination fees, up to Up to 4.75%, can be somewhat pricey. Since origination fees are a one-time cost spread over the life of the loan, they have a particularly large impact on the APR of a shorter loan.

If you do some comparison shopping and conclude that Avant is a cost-effective debt consolidation option, their website offers a user-friendly experience. This includes an online application, a soft credit inquiry that won’t impact your credit score when checking loan options, funding as quickly as next business day and live support via phone or email.

*If approved, the actual loan terms that a customer qualifies for may vary based on credit determination, state law, and other factors. Minimum loan amounts vary by state.

**Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33.

Based on the responses from 7,302 customers in a survey of 140,258 newly funded customers, conducted from August 1, 2018 - August 1, 2019, 95.11% of customers stated that they were either extremely satisfied or satisfied with Avant. 4/5 Customers would recommend us. Avant branded credit products are issued by WebBank, member FDIC.

Compare Loan Rates for Poor Credit

By clicking “Compare Personal Loan Rates for Poor Credit”, you may or may not be matched with any lender mentioned in this article. Based on your creditworthiness, you may be matched with up to five different lenders in our partner network.

Learn more about debt consolidation

Before you start hunting for a loan, here are some basics of debt consolidation to help you decide if it is right for you:

How to find the best debt consolidation loan

As you may have noticed when looking at the table of lender information, loan terms and costs can vary greatly depending on your credit status. So, don’t make any decisions about a debt consolidation loan until you have a specific quote for your situation.

Once you obtain a quote, some key things to look at in evaluating debt consolidation loan offers include the following:

  1. Is the APR lower than the rate I am currently paying?
  2. Can I afford the monthly payments?
  3. What will be the total cost over the life of the loan?

Knowing the answer to those questions will help you see which is the right debt consolidation loan for you and whether debt consolidation is a strategy that makes sense for your situation.

How does debt consolidation affect credit scores?

The goal of debt consolidation may be to improve your credit history, but in the short-term, it may actually hurt your credit score. This is because adding a new source of credit might count against you, and even applying for credit can have a negative impact on your score.

You may notice that some lenders advertise doing a “soft credit inquiry” which won’t affect your credit score. To minimize the impact of debt consolidation, whenever possible try to get rate quotes that involve soft inquiries, and minimize applications that involve hard inquiries unless you have obtained enough specific rate information to be confident that the lender will be a good option for you.

Alternatives to debt consolidation loans

Besides debt consolidation loans, there are other ways to consolidate debt including:

  1. Balance transfer credit cards. These often include special offers with rates as low as 0 percent for a limited period of time.
  2. Home equity loans or lines of credit. Borrowing against the equity in your home can be the lowest-cost form of a debt consolidation loan if you have sufficient equity to qualify.
  3. Cash-out refinancing. The issues here are similar to those with home equity loans, with the added consideration that refinancing your existing mortgage makes the most sense if you can lower your interest rate in the process.
  4. Borrowing from retirement plans. If you have a balance in a 401(k) or 403(b) retirement plan, your employer’s plan may let you borrow against it.

You can learn more about pros and cons to each debt consolidation method here

Debt consolidation can be an effective financial management technique, but it is not a cure-all. Be sure to make a plan for getting out of debt, choose the type of credit you use carefully and then shop for the best lender terms for that type of credit.

¹The Annual Percentage Rate (APR) is the cost of credit as a yearly rate and ranges from 5.99% to 29.99%, which may include an origination fee from 0.99% - 6.99% that is deducted from loan proceeds. Any origination fee on a loan term 4-years or longer will be at least 4.99%. The loan term and the APR offered will depend on your credit score, income, debt payment obligations, loan amount, credit usage history and other factors. Additionally, the APR offered is impacted by your loan term and may be higher than our lowest advertised rate. Requests for the highest loan amount may result in an APR higher than our lowest advertised rate. You need a minimum 700 FICO® score and a minimum individual annual income of $100,000 to qualify for our lowest rate.

Best Egg loans are unsecured personal loans made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC. Equal Housing Lender. "Best Egg" is a trademark of Marlette Funding, LLC. All uses of "Best Egg" on this site mean and shall refer to "the Best Egg personal loan" and/or "Best Egg on behalf of Cross River Bank, as originator of the Best Egg personal loan," as applicable. Loan amounts generally range from $2,000-$35,000. Offers up to $50,000 may be available. Residents of Massachusetts have a minimum loan amount of $6,500; New Mexico and Ohio, $5,000; and Georgia, $3,000. For a second Best Egg loan, your total existing Best Egg loan balances cannot exceed $50,000. Borrowers should refer to their loan agreement for specific terms and conditions. Your verifiable income must support your ability to repay your loan. Upon loan funding, the timing of available funds may vary depending upon your bank's policies.

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Debt Consolidation Loans Using LendingTree