Personal Loans to Consolidate Credit Card Debt
Digging your way out of debt is no easy feat when you’re dealing with credit cards and other high-interest accounts. A debt consolidation loan — which is really just a personal loan — can offer some much-needed financial relief by consolidating outstanding balances from different creditors into a single, manageable monthly payment.
That’s not all: Personal loans typically offer lower interest rates than credit cards, which means you could have lower monthly payments as well. Let’s take a closer look at how debt consolidation loans work so you can decide if they’re right for you.
How to consolidate debt with a personal loan
Using a personal loan to consolidate debt is a quick-and-easy process. Just follow these three simple steps:
- Apply for a debt consolidation loan
- Receive your loan funds
- Pay back your personal loan amount
1. Apply for a debt consolidation loan
Once you’ve found a lender with the right financing terms, applying for a debt consolidation loan online shouldn’t take very long at all. You can apply for a personal loan from us in as little as 10-to-15 minutes. And if you just want to check how much you qualify for, you can see your loan terms without affecting your credit score.
2. Receive your loan funds
Once your loan is approved, you should receive your funds within 1-to-2 business days. We deposit the full amount in your bank account as a lump sum, which can be used as you see fit. You could then pay each of your debt balances — credit cards, payday loans and other high-interest debt — individually.
3. Pay back your personal loan amount
Once you’ve consolidated your credit card debt, you’ll still need to repay your personal loan. Just like any other loan — mortgage, auto loan, etc. — you’ll schedule monthly payments to chip away at your balance until it’s paid back in full. We offer repayment plans running anywhere from 12 months to 60 months, so you’ll know exactly when you’ll be free and clear of your debt.
Is it a good idea to consolidate credit card debt with a loan?
In many cases, absolutely. Personal loans can be an effective way to consolidate credit card debt, offering plenty of enticing benefits:
- Lower interest rate: Debt consolidation debt consolidation personal loans often undercut credit cards when it comes to interest rates — and usually by a significant amount.
- Less time to become debt-free: Personal loan lenders frequently create amortization schedules that help you pay off your debt in full in just 12-60 months.
- Smaller monthly payments: When you add up all of the payments you need to make to stay current on your credit card balances and chip away at the interest, it will most likely exceed whatever your monthly payment would be on a debt consolidation personal loan.
- Greater financial flexibility: By clearing the slate with your credit card debt and replacing several payments with one manageable monthly statement, you can free up your finances to focus on other expenses.
- Simplify your debt obligations: If you have multiple credit card accounts, it can be very challenging to keep up with all of your monthly payments. When you consolidate credit card debt with a personal loan, you’ll only need to make one payment every month.
Given all of that, it should come as no surprise that many people turn to a personal loan to pay off credit cards.
In conclusion
Getting out from under credit card debt and other high-interest loans can take years — decades, in some cases. A debt consolidation personal loan can restructure your outstanding balances in a way that makes it far easier to keep up with monthly payments and repay what you owe in a relatively short amount of time. Not to mention, you’ll have paid less interest once you’re free and clear.
Once you’ve decided to take out a personal loan to consolidate debt, don’t hesitate to start the application process. Before you know it, you’ll have the funds needed to consolidate credit card debt once and for all.
Disclaimer:
* You must be 18 years of age or older. To qualify, a borrower must be a US citizen, a permanent resident, or a non-permanent resident in the US on a valid, long-term visa. All loan applications are subject to credit review and approval as well as income and employment verification. You must meet our minimum requirements established for this offer including, but not limited to, credit history, debt-to-income ratio, and application information. Your actual rate depends on your requested loan amount, loan term, creditworthiness, and a variety of other factors. Loan amounts range from $4,000 - $50,000. Rates and loan amount may differ due to state specific requirements and may impact your ability to qualify for a loan. Limitations: CA (rate and amount), FL, ME, NC, TX and VT (rate), IL, MA, RI (amount). The lowest rate advertised is reserved for the most creditworthy borrowers. Advertised rates and terms are current as of 8/10/2022 and are subject to change without notice.
All information provided in this publication is for informational and educational purposes only, and in no way is any of the content contained herein to be construed as financial, investment, or legal advice or instruction. Rate, Inc. does not guarantee the quality, accuracy, completeness or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error-free. Some information in the publication may have been provided by third parties and has not necessarily been verified by Rate. Rate its affiliates and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action.