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Debt consolidation loans for borrowers with fair credit

You can use an unsecured personal loan to consolidate debt or finance large purchases. Interest rates and terms can vary, based on your credit score and other factors. Compare loans from multiple lenders and learn more about personal loans.


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We found 7 options from our lending partners

3 year loan

Upstart

on Upstart

Upstart

4.5

NerdWallet rating 
Upstart

4.5

NerdWallet rating 
APR 
6.53-35.99% 

Mo. payment 
$189 

Min. credit 
580 

on Upstart


Min. credit

580

Qualifications

  • Minimum credit score: 580.

  • Minimum credit history: None, this lending platform accepts borrowers with credit history too limited to produce a FICO score.

  • Minimum gross income: $12,000.

  • Employment: Full-time job, full-time job offer starting in 6 months, a regular part-time job, or another source of regular income.

  • Must have U.S. residential street address where borrower resides (unless military personnel on active duty).

  • Must be at least 18 years old.

  • Valid email account required.

  • Personal bank account with U.S. routing number required.

Pros

  • Accepts borrowers new to credit.

  • Able to fund loans within one business day.

  • Offers direct payment to creditors with some debt consolidation loans.

Cons

  • Borrowers can choose from only two repayment term options.

  • Charges origination fee.

Disclaimer

The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 24.4% and 36 monthly payments of $36 per $1,000 borrowed. There is no down payment and no prepayment penalty. Average APR is calculated based on 3-year rates offered in the last 1 month. Your APR will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will be approved.

Goldman Sachs

on Goldman Sachs

Goldman Sachs

5.0

NerdWallet rating 
Goldman Sachs

5.0

NerdWallet rating 
APR 
6.99-19.99% 

Mo. payment 
$170 

Min. credit 
660 

on Goldman Sachs


Min. credit

660

Qualifications

  • Minimum credit score: 660.

  • Must be 18 or over, 19 in Alabama and 21 in Mississippi and Puerto Rico.

  • Must have a valid U.S. bank account and Social Security or Individual Tax I.D. Number.

  • May need to provide proof of income, including recent pay stubs or bank statements.

Pros

  • No fees.

  • Competitive rates among online lenders.

  • Wide variety of repayment term options.

  • Rate discount for autopay.

  • Offers direct payment to creditors for debt consolidation loans.


Cons

  • No co-sign, joint or secured loan option.

Disclaimer

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.

Avant

on Avant

Avant

4.0

NerdWallet rating 
Avant

4.0

NerdWallet rating 
APR 
9.95-35.99% 

Mo. payment 
$193 

Min. credit 
550 

on Avant


Min. credit

550

Qualifications

  • Minimum credit score of 550.

Pros

  • Able to fund loans the next business day.

  • Option to change your payment date.

  • Soft credit check with pre-qualification.

  • Offers secured loan option.

Cons

  • Charges an origination fee.

  • Does not offer direct payment to creditors with debt consolidation loans.

  • No co-sign or joint loan option.

Disclaimer

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. Minimum loan amounts may vary by state. If approved, the actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. An administration fee of up to 4.75% will be deducted from the loan proceeds. Avant branded credit products are issued by Webbank, member FDIC

Best Egg

on Best Egg

Best Egg

4.0

NerdWallet rating 
Best Egg

4.0

NerdWallet rating 
APR 
11.8-18.2% 

Mo. payment 
$173 

Min. credit 
600 

on Best Egg


Min. credit

600

Qualifications

  • Minimum credit score: 600; borrower average is 700.

  • Minimum credit history: 3 years and 3 accounts.

  • Minimum income: No minimum income requirement; borrower average is $80,000. Borrower must have enough cash flow to cover current financial obligations.

  • Minimum debt-to-income ratio: 40% or 65% including a mortgage; borrower average is 40%.

  • Employment: Must provide proof of income; part-time employees are eligible.

  • Must provide valid U.S. address and Social Security number.

Pros

  • Competitive rates among fair-credit lenders.

  • Able to fund loans within one business day.

  • Secured loan option for homeowners.

Cons

  • Charges origination fee.

  • Does not offer direct payment to creditors with debt consolidation loans.

  • Borrowers can choose from only two repayment term options.

Disclaimer

*Trustpilot TrustScore as of June 2020. Best Egg personal loans, including the Best Egg Secured Loan, are 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. "Best Egg Secured Loan" is a pending trademark of Marlette Funding, LLC. All uses of “Best Egg” refer to “the Best Egg personal loan”, “Best Egg on behalf of Cross River Bank, as originator of the Best Egg personal loan” and/or "the Best Egg Secured Loan"as applicable. The term, amount and APR of any loan we offer to you will depend on your credit sc¬ore, income, debt payment obligations, loan amount, credit history and other factors. Your loan agreement will contain specific terms and conditions. About half of our customers get their money the next day. After successful verification, your money can be deposited in your bank account within 1-3 business days. The timing of available funds upon loan approval may vary depending upon your bank’s policies. Loan amounts range from $2,000– $50,000. 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. Annual Percentage Rates (APRs) range from 5.99%–29.99%. The APR is the cost of credit as a yearly rate and reflects both your interest rate and an origination fee of 0.99%–5.99% of your loan amount, which will be deducted from any loan proceeds you receive. The origination fee on a loan term 4-years or longer will be at least 4.99%. Your loan term will impact your APR, which may be 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 APR. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. What this means for you: When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.

Upgrade

on Upgrade

Upgrade

5.0

NerdWallet rating 
Upgrade

5.0

NerdWallet rating 
APR 
14.0-27.0% 

Mo. payment 
$187 

Min. credit 
580 

on Upgrade


Min. credit

580

Qualifications

  • Minimum credit score: 580.

  • Minimum annual income: $35,000; average borrower income is $87,000.

  • Minimum credit history: 3 years.

  • Minimum number of accounts on credit history: 2.

  • Minimum monthly free cash flow: $800.

  • Maximum debt-to-income ratio: Varies between 55% and 65% including the loan you’re applying for and mortgage payments. To see your post-loan DTI, calculate your monthly payments on a personal loan, and then add them to your debt-to-income calculation.

  • Average loan amount is $10,000.

  • Average repayment term is 40 months.

Pros

  • Allows secured, co-signed and joint loans.

  • Offers rate discount with direct payment to creditors on debt consolidation loans.

  • Rate discount for autopay.

Cons

  • Charges origination fee.

  • Charges late fee.

Disclaimer

Personal loans made through Upgrade feature APRs of 5.94%-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. Personal loans issued by Upgrade's lending partners. Information on Upgrade's lending partners can be found at https://www.upgrade.com/lending-partners/. 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.

Prosper Borrowers

on Prosper Borrowers

Prosper Borrowers

4.5

NerdWallet rating 
Prosper Borrowers

4.5

NerdWallet rating 
APR 
17.3-22.9% 

Mo. payment 
$186 

Min. credit 
640 

on Prosper Borrowers


Min. credit

640

Qualifications

  • Minimum credit score: 640; borrower average is 726.

  • Minimum credit history: 2 years.

  • Minimum income: No minimum income requirement; borrower average is $113,000.

  • Maximum debt-to-income ratio: 50% (excluding mortgage); borrower average is 18% with housing payment.

  • No bankruptcies filed within the past year.

  • At least three open accounts on credit report.

  • Fewer than five credit bureau inquiries in the last six months.

  • Must be at least 18 years old.

  • Must provide Social Security number and a U.S. bank account.


Pros

  • Option to change your payment date.

  • Offers joint loan.

  • Offers wide range of loan amounts. 


Cons

  • No rate discount for autopay.

  • Charges origination and late fees.

  • Borrowers can choose from only two repayment term options.

Disclaimer

For example, a three-year $10,000 personal loan would have an interest rate of 11.74% and a 5.00% origination fee for an annual percentage rate (APR) of 15.34% APR. You would receive $9,500 and make 36 scheduled monthly payments of $330.90. A five-year $10,000 personal loan would have an interest rate of 11.99% and a 5.00% origination fee with a 14.27% APR. You would receive $9,500 and make 60 scheduled monthly payments of $222.39. Origination fees vary between 2.41%-5%. Personal loan APRs through Prosper range from 7.95% to 35.99%, with the lowest rates for the most creditworthy borrowers. Eligibility for personal loans up to $40,000 depends on the information provided by the applicant in the application form. Eligibility for personal loans is not guaranteed, and requires that a sufficient number of investors commit funds to your account and that you meet credit and other conditions. Refer to Borrower Registration Agreement for details and all terms and conditions. All personal loans made by WebBank, Member FDIC.

LendingClub

on LendingClub

LendingClub

4.0

NerdWallet rating 
LendingClub

4.0

NerdWallet rating 
APR 
19.5-30.1% 

Mo. payment 
$198 

Min. credit 
600 

on LendingClub


Min. credit

600

Qualifications

  • Minimum credit score of 600. LendingClub uses FICO 8 credit scoring model.

  • Minimum credit history of three years.

  • Debt-to-income ratio of less than 40% for single applications, 35% combined for joint applicants.

Pros

  • Offers co-signed and joint loan options.

  • Offers direct payment to creditors with debt consolidation loans.

  • Soft credit check with pre-qualification.

Cons

  • Borrowers can only choose from two repayment term options.

  • Rates are high compared to other online lenders.

  • Charges an origination fee.

Disclaimer

A representative example of loan payment terms is as follows: you receive a loan of $13,411 for a term of 36 months, with an interest rate of 12.16% and a 5.30% origination fee of $711, for an APR of 15.99%. In this example, you will receive $12,700 and will make 36 monthly payments of $446.46. Loan amounts range from $1,000 to $40,000 and loan term lengths are 36 months or 60 months. Some amounts and term lengths may be unavailable in certain states. APR ranges from 8.05% to 35.89% and is determined at the time of application. Origination fee ranges from 3% to 6% of the loan amount. Lowest APR is available to borrowers with excellent credit. Advertised rates are subject to change without notice. Loans are made by LendingClub Bank, N.A., Member FDIC (“LendingClub Bank”), a wholly-owned subsidiary of LendingClub Corporation, NMLS ID 167439. Loans are subject to credit approval and sufficient investor commitment before they can be funded or issued. Certain information that we subsequently obtain as part of the application process (including but not limited to information in your consumer report, your income, the loan amount that your request, the purpose of your loan, and qualifying debt) will be considered and could affect your ability to obtain a loan from us. Loan closing is contingent on accepting all required agreements and disclosures at Lendingclub.com. “LendingClub” is a trademark of LendingClub Bank.


How to choose the best personal loan

Updated: April 23, 2021

What is a personal loan?

An unsecured personal loan is a fixed-rate loan that is not backed by collateral and is repaid in monthly installments over a specific term, usually two to seven years. When you need money to cover a large expense or to consolidate your debt, consider a personal loan. You can use the funds for almost any purpose.

To qualify you, lenders look at factors including your credit score, credit report and debt-to-income ratio. You can get a personal loan from some major banks, credit unions and online lenders.

What rate should I expect?

Here’s what interest rates on personal loans look like, on average:

How's your credit?

Score range

Estimated APR

Excellent

720-850

11.8%

Good

690-719

17.4%

Fair

630-689

23.4%

Bad

300-629

28.7% (Lowest scores unlikely to qualify.)

Source: Average rates are based on aggregate, anonymized offer data from users who pre-qualified in NerdWallet’s lender marketplace between Jan. 1, 2020, and Dec. 31, 2020. Rates are estimates only and not specific to any lender.

Borrowers with good to excellent credit (690 and higher on the FICO scale) typically get the lowest interest rates and can borrow larger amounts. They also have the most options when it comes to shopping for a loan.

Those with fair to bad credit (FICO scores below 689) may have to look a little harder and pay a higher rate for a personal loan. Some online lenders target low-credit borrowers, offering loans with rates from 18% to 36% APR. Having steady income, low debt, a long credit history and a record of on-time payments will improve your chances of being approved.

Before you choose a personal loan

  • Check your credit score. Learn about your personal loan options based on your credit score. This will give you an idea of what rate and payment to expect as you shop for loans. You might decide to postpone getting a loan and instead take steps to build your credit in order to get a lower rate or a larger loan.

  • Compare your options. Interest rates on personal loans for good credit start around 5% APR, but if you can qualify for 0% interest credit card — and pay off the balance within the promotional period — then you may be better off with the credit card. Here's how to compare personal loans and credit cards.

  • Find a co-signer. If you have bad credit, having a co-signer with good credit allows you to piggyback on his or her creditworthiness and potentially get a better rate.

  • Consider a secured loan. Using a car, savings account or other asset as collateral may get you a lower rate.

  • Assess your overall financial well-being. Personal loans work best as part of a balanced financial plan. Borrow money to consolidate debt if it means you’ll get out of debt more quickly. But don’t borrow if it only adds financial strain. If your current debt is overwhelming, investigate your debt-relief options.

How does coronavirus impact personal loans?

In response to the COVID-19 crisis, some lenders introduced small-dollar loans for consumers dealing with financial losses. Other lenders tightened requirements for their loans, making it more difficult for borrowers with bad credit to qualify for a personal loan.

Especially during difficult times, it’s important to know the hardship options lenders offer. Some lenders allow you to defer loan payments for a specified time. If you miss payments without first notifying your lender, your credit will take a hit and your loan could be in default.

Reasons to get a personal loan

One benefit of getting a personal loan is you can use the money for nearly any purpose. Ideally, getting one positively impacts your overall financial health, by helping you pay off debt faster, for example, or adding to the value of your home. Here are some top reasons consumers get personal loans:

  • Debt consolidation: Roll your debts into one monthly payment, potentially reducing the interest you pay toward the debt and helping you pay it off faster.

  • Home improvement: Need to add on a home office or install a swimming pool? Use a personal loan to cover the costs.

  • Large expenses: You can use a personal loan to buy a boat, RV or other items with large price tags.

  • Weddings: Using a personal loan to pay for your wedding can help you stick to a budget.

How do I pick the best personal loan?

If you decide a personal loan is right for you, always compare rates from multiple lenders. The loan with the lowest APR is the least expensive — and therefore, usually the best choice.

Also consider the loan’s term and monthly payments. A longer term may mean lower monthly payments, but you’ll pay more in interest over the life of the loan. Assess how the payments fit into your monthly budget.

Some loans have features that may be important to you. If you’re consolidating debt, a lender that sends your loan proceeds directly to your creditors saves you that step in the process. Some lenders offer flexible payment options that allow you to change a payment due date or defer a payment.

How to get a personal loan

Most online lenders allow you to pre-qualify and see estimated rates without affecting your credit score, so it pays to shop around.

If you have good credit and an existing banking relationship, it’s worth checking out loan options from your current bank or credit union. Here are some top banks that offer personal loans.

To compare rates from online lenders, use NerdWallet’s lender marketplace above to pre-qualify and easily compare several offers at once. If you qualify, you could receive your money as soon as the next day.

Online personal loan companies reviewed by NerdWallet

Best lenders for excellent-credit borrowers (FICO score above 720)

Lender

Best for

NerdWallet star rating

Discover

Flexible payment options.

LightStream

Low rates.

Marcus

No fees.

SoFi

Free financial advising.

Best lenders for good-credit borrowers (FICO score between 690 and 719)

Lender

Best for

NerdWallet star rating

Best Egg

Fast loans with low starting rates.

FreedomPlus

Lower rates for joint loans.

LendingClub

Credit building features.

Payoff

Credit card consolidation.

Prosper

Joint loans and flexible payment options.

Rocket Loans

Fast application and funding process.

Best lenders for fair- or bad-credit borrowers (FICO score below 690)

Lender

Best for

NerdWallet star rating

Avant

Flexible payments and refinance option.

LendingPoint

Fast application and approval.

OneMain

Joint and secured loan options.

Upgrade

Debt consolidation and credit tools.

Upstart

Accepts limited credit history.

See more personal loan options on NerdWallet


Disclaimers

Annual Percentage Rates (APR), loan term and monthly payments are estimated based on analysis of information provided by you, data provided by lenders, and publicly available information. All loan information is presented without warranty, and the estimated APR and other terms are not binding in any way. Lenders provide loans with a range of APRs depending on borrowers' credit and other factors. Keep in mind that only borrowers with excellent credit will qualify for the lowest rate available. Your actual APR will depend on factors like credit score, requested loan amount, loan term, and credit history. All loans are subject to credit review and approval.