The best debt consolidation loans for bad credit can be an effective way to streamline your monthly debt payments and accelerate the payoff process. While qualifying for a debt consolidation loan can often be challenging, especially for bad credit, fortunately, some lenders still provide these loans to those with less-than-perfect credit. With various options available, it’s important to carefully choose the best debt consolidation loan that suits your specific needs.
Generally, borrowers with bad credit face high interest rates when applying for loans. This type of loan is worth considering if you’re struggling to repay a loan and have bad credit. Consolidation loans may also be a good idea to consider if you have a high interest rate on title or payday loans. Irrespective of what debt you have, getting a debt consolidation loan will help cover your debts faster.
Aside from getting this loan in person, debt consolidation loans can be gotten through online lenders who offer loans to borrowers with bad credit. When searching for the best loans, compare the interest rates. Or credit-building features, and terms of different lenders to find the one best for your situation.
Best Debt Consolidation Loans for Bad Credit
As previously stated, different lending companies offer debt consolidation loans for borrowers with bad credit. Each lender has their own interest rates and loan terms; finding the best one for you makes paying off your debt easier. According to my analysis, the following are some of the best debt consolidation loans for bad credit you should consider:
Upgrade
This lender offers accessible online and mobile banking services to borrowers wanting to consolidate debts. Compared to other lenders, Upgrade has high APRs and allows lenders with bad credit to apply and get approved for loans. This lender has loan amounts ranging from $1,000 to $50,000 and has a repayment term of two to seven years.
Universal Credit
This is an online lender that offers personal loans ranging from $1,000 to $50,000 through its partners. It has a repayment term that ranges between three and seven years after loan approval. Universal credit allows borrowers with bad credit to get debt consolidation loans easily.
Achieve
This is an indirect lender that offers personal loans to borrowers with bad credit. It offers flexible terms between two to five years, and borrowers are allowed to borrow between $7,500 and $40,000. Because of these, borrowers can get higher debt consolidation loan amounts along with a higher repayment term, giving them enough time to pay back the loan.
LendingClub
LendingClub is one of the largest online lenders and offers personal loans as well as debt consolidation loans. This lender offers loans with high APRs along with no autopay discounts; it allows borrowers to take loan amounts from $1,000 up to $40,000, which is higher than that of other lenders.
SoFi
SoFi allows borrowers with bad credit to apply for debt consolidation loans through a co-signer. This is because this lender has a high credit score requirement, making it hard for borrowers with bad credit to qualify for loans, but with cosigners, they can easily apply for a loan. SoFi allows borrowers to borrow up to $100,000 and get a repayment term of up to seven years, making it a preferable option.
FAQs:
Does debt consolidation loans affect my credit?
Whether positively or negatively, debt consolidation can affect your credit. Applying for a new loan to pay off old loans and including it in your credit report may damage your credit score. While debt consolidation helps pay off old loans quickly, it reduces the number of accounts on your credit history, making it balanced.
Is it a Good Idea to Get a Debt Consolidation Loan?
Getting the best loan with beneficial terms and debt consolidation loans may be good for your finances. For instance, if a new loan has lower interest rates than existing loans, the overall cost of a debt can be reduced. In cases where your new loan terms are too expensive to afford, it is not a good idea to get a debt consolidation loan.
How Long Does Debt Consolidation Loan Approval Take?
Debt consolidation loan approval works similarly to that of personal loans. Some lenders approved these loans on the same day of application; this is, however, common mostly between online lenders. Other lenders take between a few days and a week after approval to approve debt consolidation loans. Sometimes, a few days after approval is taken to pay out funds.