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Best for overall debt consolidation loan
2025 NerdWallet award winner
7.90 - 35.99%
$1K - $60K
600
2 to 7 years
A LendingClub personal loan is a standout option for qualified borrowers who want to pay off debt with flexible terms.
Read our review of LendingClubA LendingClub personal loan is a standout option for qualified borrowers who want to pay off debt with flexible terms.
Read our review of LendingClubBest for borrowers with good credit
2025 NerdWallet award winner
8.74 - 35.49%
$5K - $100K
None
2 to 7 years
SoFi offers large online personal loans with consumer-friendly features for good- and excellent-credit borrowers.
Read our review of SoFi Personal LoanSoFi offers large online personal loans with consumer-friendly features for good- and excellent-credit borrowers.
Read our review of SoFi Personal LoanBest for multiple rate discounts
2025 NerdWallet award winner
7.74 - 35.99%
$1K - $50K
600
2 to 7 years
Upgrade accepts lower credit scores than similar lenders, and it offers multiple rate discounts for its personal loans.
Read our review of UpgradeUpgrade accepts lower credit scores than similar lenders, and it offers multiple rate discounts for its personal loans.
Read our review of UpgradeBest for secured debt consolidation loans
6.99 - 35.99%
$2K - $50K
600
3 to 5 years
Best Egg is worth considering for borrowers looking for a secured loan or to consolidate debt.
Read our review of Best EggBest Egg is worth considering for borrowers looking for a secured loan or to consolidate debt.
Read our review of Best EggBest for fast approval and funding
2025 NerdWallet award winner
7.99 - 24.99%
$2.5K - $40K
660
3 to 7 years
With competitive rates and no origination fees, Discover personal loans are good options for borrowers with good and excellent credit.
Read our review of Discover® Personal LoansWith competitive rates and no origination fees, Discover personal loans are good options for borrowers with good and excellent credit.
Read our review of Discover® Personal LoansBest for instant pre-qualification
7.95 - 29.99%
$5K - $40K
640
2 to 5 years
Happy Money offers loans and ongoing support to help fair- and good-credit borrowers consolidate credit card debt.
Read our review of Happy MoneyHappy Money offers loans and ongoing support to help fair- and good-credit borrowers consolidate credit card debt.
Read our review of Happy MoneyBest for joint debt consolidation loans
8.99 - 29.99%
$5K - $50K
640
2 to 5 years
Achieve personal loans can be a good debt consolidation option for borrowers with fair credit or better who qualify for a rate discount.
Read our review of Achieve Personal LoansAchieve personal loans can be a good debt consolidation option for borrowers with fair credit or better who qualify for a rate discount.
Read our review of Achieve Personal LoansBest for borrowers with bad credit
11.69 - 35.99%
$1K - $50K
560
3 to 5 years
A Universal Credit personal loan may be a smart choice for borrowers with lower credit scores who want to consolidate debt.
Read our review of Universal CreditA Universal Credit personal loan may be a smart choice for borrowers with lower credit scores who want to consolidate debt.
Read our review of Universal CreditOur team of consumer lending experts follows an objective and robust methodology to rate lenders and pick the best.
30+
Lenders reviewed
We review over 35 lenders, including major banks, top credit unions, leading digital platforms, and high interest installment lenders operating across multiple states.
25+
Categories assessed
Each lender is evaluated across five weighted categories and 27 subcategories, covering affordability, eligibility, consumer experience, flexibility, and application process.
60+
Data points analyzed
Our team tracks and reassesses hundreds of data points annually, including APR ranges, fees, credit requirements, and borrower tools, ensuring up to date, accurate comparisons.
We evaluate more categories than competitors and carefully weigh how each factor impacts your experience.
NerdWallet’s review process evaluates and rates personal loan products from more than 30 financial technology companies and financial institutions. We collect over 60 data points and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.
Why we chose LendingClub: LendingClub’s balance transfer loan is a standout option for anyone looking to pay off debt. Not only can you see your potential loan offer with no risk to your credit score, once you apply, applications are typically approved within one hour. You can then choose to have the loan funds sent directly to your creditors or have the money deposited in your bank account in as little as one business day.
» LEARN MORE: Full review of LendingClub personal loans
Why we chose SoFi: If you have a strong credit profile, SoFi’s debt consolidation loan is hard to beat. You can qualify for multiple rate discounts, including a 0.25 percentage point discount for having SoFi pay off your creditors directly. You’ll also get access to unique perks that are hard to find with other lenders, including free financial planning.
» LEARN MORE: Full review of SoFi personal loans
Why we chose Upgrade: Upgrade’s debt consolidation loans include multiple ways to save money on interest via rate discounts. Setting up automatic monthly payments on your loan and sending the funds directly to your creditors are two easy ways to get a sizable reduction. Plus, Upgrade’s lower credit score requirement (600) means you can qualify even if you have fair or bad credit.
» LEARN MORE: Full review of Upgrade personal loans
Why we chose Best Egg: Best Egg lets you secure its debt consolidation loan with a personal vehicle or a permanent fixture in your home, like built-in cabinets or bathroom vanities. Securing a loan helps guarantee the loan for the lender, so you’ll usually get a lower interest rate than you would on an unsecured loan. But if you fail to repay, the lender can seize the collateral.
» LEARN MORE: Full review of Best Egg personal loans
Why we chose Discover: When you apply for a debt consolidation loan with Discover, it can approve and fund you that same day, as long as you already have a Discover bank account. If you request a direct deposit into another account, Discover can fund the loan in one business day. Going from application to funding in one day is lightening-fast even for an online lender.
» LEARN MORE: Full review of Discover personal loans
Why we chose Happy Money: Happy Money’s payoff loan comes with the ability to pre-qualify online and see loan offers instantly. According to the lender, borrowers can view their potential loan amount, interest rate, repayment term and monthly payment with no hit to their credit score. If you move forward with your application, Happy Money does a hard credit pull, which is typical among personal loan lenders.
» LEARN MORE: Full review of Happy Money personal loans
Why we chose Achieve: Achieve customers who opt into a joint loan may receive a rate discount of two percentage points, on average, which is a rare perk among lenders. A joint loan gives co-borrowers equal access to the loan funds. If you apply with a borrower who has better credit or a higher income than you, you may increase your odds of getting approved.
» LEARN MORE: Full review of Achieve personal loans
Why we chose Universal Credit: Universal Credit has a low minimum credit score requirement (560), making it an accessible loan option for most borrowers. But you won’t be settling for a second-tier product. Its consolidation loans are highly customizable with a wide range of loan amounts, direct payment to creditors and funding in one business day after you’re approved.
» LEARN MORE: Full review of Universal Credit personal loans
Debt consolidation loans are a type of personal loan that combine multiple unsecured debts — such as credit cards, medical bills or payday loans — into one fixed monthly payment amount, making the debt easier to pay off.
Online lenders, banks and credit unions offer debt consolidation loans, which you can typically apply for online.
As long as the interest rate on the debt consolidation loan is lower than the average rate of your existing debts, you’ll save money and likely get out of debt faster. For the most qualified borrowers, loan rates can be as low as 7%.
Debt consolidation loans are an especially smart choice for consolidating high-interest debt, like credit cards, and are sometimes called credit card consolidation loans.
» MORE: What is debt consolidation and should I consolidate?
Did you know? According to NerdWallet’s midyear check-in report, conducted online by The Harris Poll, more than a third of Americans (35%) set a financial goal to pay off or pay down debt in 2025. A quarter of Americans (25%) want to pay off/down credit cards. The top barriers cited by those with debt payoff goals are increased expenses (43%), decreased income (24%) and high interest rates (26%).
When you’re approved for a debt consolidation loan, the lender deposits the money in your bank account. You then use that money to pay off all your debts at once, so you’re left with only the single loan.
Some lenders may offer to pay off your debts for you. This is called “direct payment to creditors” and though it’s not a must-have feature, it’s a nice perk, since it eliminates the temptation to use the money for anything else.
Once your debts are paid off, you only have to worry about the loan payment. Since these loans come with fixed rates, you'll pay the same amount each month.
Repayment terms typically range from two to seven years, though most lenders let you pay off your loan early with no prepayment penalty. Once the loan is paid in full, you’re officially debt-free.
See if debt consolidation is for you by estimating how much you can save
Current monthly payment$1,000
Current monthly payment
New monthly payment$554
New monthly payment
With an excellent credit score, we estimate a 11.81% APR for a 5-year personal loan.
Let’s say you have $8,000 in credit card debt, spread out across four different credit cards.
The average annual percentage rate on a credit card is about 22%. If you’re making a minimum payment of $45 on each card, at 22% APR, it’ll take you almost eight years to be debt-free. It will also cost you $8,740 in interest, on top of the original debt.
But if you pay off all your credit cards at once using an $8,000 debt consolidation loan, at 12% APR, you’ll save over $6,000 on interest. You’ll still have the same monthly payment, and you’ll get out of debt three years earlier with a five-year repayment term.
Debt consolidation loans are available to borrowers across the credit spectrum, so you can still get a debt consolidation loan even if you have fair or bad credit (a score below the mid-600s).
Lenders weigh multiple factors in your loan application, including credit score, credit history, existing debt and income, to understand your financial situation.
Some lenders allow you to add a co-signer or co-borrower to your loan application, or secure the loan with collateral, like your car. These options boost your chances of qualifying for a debt consolidation loan.
» COMPARE: Best debt consolidation loans for bad credit
What the nerds think
“Fed officials have lowered rates twice this year, but debt consolidation loans aren’t as affected by what the Fed does compared to products like mortgages. If you’re feeling overwhelmed by credit cards or other high-interest debt, it’s best to start paying it off now with a lower-rate consolidation loan than trying to perfectly time the market. Just think, whatever savings you may gain by getting a consolidation loan at a slightly lower rate will likely be wiped out by the double-digit interest you’ll pay on your credit cards in the meantime.”
1. Know your credit score before applying
A quick check to your credit score gives you an idea of where you stand in terms of the credit brackets — excellent, good, fair or bad — and which lenders may be the best fit based on their minimum credit score requirement. You can check your credit score for free on NerdWallet.
2. Pre-qualify and compare multiple loan offers
To get the best deal on a debt consolidation loan, pre-qualify with lenders to compare rates and terms before you apply. Pre-qualification won’t hurt your credit score.
Though you can pre-qualify with each lender individually, NerdWallet lets you pre-qualify with multiple lenders at once, so you can more easily compare loan options.
3. Submit your application
Once you’ve decided on a lender, it’s time to formally apply. Loan applications ask for personal information like your Social Security number, address and other contact details. You also may be asked to provide proof of identity, employment and income.
Some online lenders can approve applications the same day and send loan funds in one business day.
4. Pay off your creditors
After receiving the loan funds, use the money to pay off all your debts. Some lenders may offer to send the loan funds to your creditors for you, so you’ll need to provide the correct account information. Check the accounts later to make sure they’re paid off.
5. Start making payments on your new loan
Personal loan payments are due monthly, and you’ll likely be charged a fee for any late payments. As you make progress on your debt consolidation loan, try to keep credit card balances at or near zero. Avoid closing the accounts, which can lower your credit score.
To choose the best debt consolidation loan, ask yourself these five questions:
Does the lender’s loan amounts and terms match my debt? Debt consolidation loans come in a wide range of amounts ($1,000 to $50,000) and repayment terms (two to seven years). Make sure the lender offers the loan amount you need and enough time to pay it off.
Does the lender offer an APR lower than my existing debts? The loan's annual percentage rate, or APR, represents its true annual cost and includes interest and any fees. The most affordable loan is the one with the lowest rate.
Do I meet the lender’s qualification criteria? Some lenders openly disclose their borrower requirements, including minimum credit score, credit history and income. You can check the lender’s website for this information or call and ask to speak to a loan officer.
Does this lender charge an origination fee? An origination fee ranges from 1% to 10% of the loan amount and is deducted from the loan proceeds or added to the loan balance. Avoid loans with this fee, unless the APR (which includes the origination fee) is still lower than loans with no origination fee.
Does this lender offer special debt consolidation features? Some lenders offer extra perks, like sending the loan funds directly to your creditors or free credit score monitoring. Consider these features, but always prioritize an affordable loan you can repay on-time.
Debt consolidation loans are a good idea if you can get a lower annual percentage rate than what you're currently paying across your other debts. Here’s a closer look at the pros and cons.
For borrowers with good to excellent credit, transferring debts to a 0% balance transfer card is a great option — as long as you can pay it off during the introductory period, which can last up to 21 months.
This is sometimes called credit card refinancing, and it's similar to a consolidation loan. But because you pay no interest during the introductory period, you can get out of debt even faster.
» MORE: Best balance transfer credit cards
Nonprofit organizations offer credit counseling, which includes helping you create a debt management plan. Similar to other consolidation products, these plans roll your debts into one manageable payment at a reduced interest rate.
» MORE: Find the right debt management plan
If you’re not sure how to tackle debt, you may not need to consolidate. The debt snowball and debt avalanche methods are two common and effective strategies for paying off debt.
The snowball method focuses on paying off your smallest debt first, building momentum as you go. The avalanche focuses on paying off the debt with the highest interest rate first, then applying the savings elsewhere. Both can boost your payoff speed.
If you have significant debt (40% or more of your income) and no plan to pay it off, you may want to explore other strategies, like debt settlement or bankruptcy. Both of these options help eliminate unsecured debts, but they hurt your credit and are typically a last resort.
Nerdy Tip
There are other ways to consolidate debt, like taking out a home equity loan or line of credit or borrowing from your retirement savings with a 401(k) loan. But these options involve more risk — to your home or to your retirement — so it’s best to go with one of the options above.
A debt consolidation loan can save you money by rolling multiple unsecured debts into one payment, ideally with a lower interest rate. You can then apply the savings in interest toward your principal debt and pay it off even faster.
Yes, you can use a debt consolidation loan to pay off many types of unsecured debts, including credit cards (it’s sometimes called a “credit card consolidation loan”). Credit cards are particularly good to consolidate, since they often have higher interest rates than consolidation loans.
Settling credit card debt is when you negotiate the debt down, so you pay less than you owe. This is usually done with the help of a third-party debt settlement company. But settlement majorly damages your credit score. NerdWallet recommends debt consolidation when possible, since it’s less risky.
Applying for a debt consolidation loan triggers a hard credit pull, which temporarily knocks a few points off your credit score. But if you use the loan to successfully pay off your debts — and limit future debt — the overall effect should be positive.
How long it takes to cross the debt-free finish line depends on how much debt you have, the interest rate on your debt and the repayment term. Terms on debt consolidation loans are typically two to seven years.
» MORE: Calculate your savings with a debt consolidation loan
