How A Personal Loan Can Help You Say Goodbye To Credit Card Debt

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How A Personal Loan Can Help You Say Goodbye To Credit Card Debt


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The average American household owes a staggering $15,654 in credit card debt, according to a recent study. Digging yourself out of a hole of debt isn’t easy, but a personal loan can be a smart way to consolidate your payments at one fixed rate.

Choosing the personal loan that’s right for you can be difficult, as the internet is full of scams and so-called “deals” which can actually worsen your financial situation. Still, there are plenty of legitimate companies which can help you regain control of your finances.

Before embarking on any research, you should always remember these tips: shop around for the best rate, never accept an interest rate higher than what you’re already paying your credit card companies, and never agree to a pre-payment penalty. Also remember that some companies will charge a loan origination fee, so factor that into your comparison calculations.

If you’re interested in applying for a personal loan with any of the companies below, log onto their website, fill out a simple questionnaire, and be told your rate in minutes. If you’re happy with the terms of the loan, press “accept,” receive your money in days, and be on your way to paying off those credit card bills for good.

Upstart

Founded by former Google employees, Upstart offers loans ranging from $1,000 to $50,000. There’s no pre-payment penalty, which means you won’t be punished for aggressively paying back the loan. The site reports that its borrowers save an average of 25% compared to their credit card rates — a substantial amount, regardless of how much debt you have.

As with any lending scenario, a better credit score will get you a better rate. However, Upstart knows that you’re more than a number in a database. Because of this, it takes other factors into account when analyzing your application, such as your education and job history.

Borrowers will need a minimum FICO score of 620, although applicants who have an insufficient credit history and therefore do not have a FICO score can also be accepted. Loan duration can be three or five years, but no pre-payment penalty means you can pay it back anytime before then.

Upstart’s interest rates range from 9.48% to 29.99%, and origination fees fall anywhere between 0% and 8% of the loan amount.

Loans not available in: WV

Payoff

This company’s mission is in its name. Payoff offers personal loans between $5,000 and $35,000. It prides itself in transparency, and clearly notes what is needed to be considered for a personal loan. Among those factors are a credit score of 640 or above, a debt-to-income ratio of 50% or less, and three years of good credit.

It offers fixed rates between 5.94% (8% APR) and 22.60% (25% APR). Payment plans range from two years to five years, but there’s no pre-payment penalty. Origination fees range from 2% to 5%, depending on the length of your loan (the shorter the duration, the lower the fee).

Payoff refers to itself as a “financial wellness company,” and employs a team of “member advocates” who will help you achieve your debt-free financial goals.

Loans not available in: AL, AZ, CT, DE, IA, KS, LA, MA, MD, MI, MN, MS, NC, NE, NH, NV, OH, OK, RI, SD, TN, VA, VT, WA, WI, or WV

SoFi

If you’re looking for a large personal loan, you may want to consider SoFi, as it lends amounts ranging from $5,000 to $100,000. There’s also no origination fee, which makes it a pretty appealing choice. APRs range from 5.49% to 14.24%, with the average borrower receiving a rate of 8.5%. Loan durations range from three to seven years, and there’s no pre-payment penalty.

This lending platform doesn’t have a minimum credit score requirement, but its borrowers tend to be higher earners with scores above 700. However, the company says the most important factor is the amount of your income which is left over after monthly expenses – a concept known as “free cash flow.”

SoFi also provides support if you lose your job through no fault of your own while paying off your personal loan. It will not only suspend your monthly payments, but will also provide job placement assistance during your forbearance period.

Loans not available in: MS or NV

NetCredit

Netcredit offers loans ranging from $1,000 to $10,000. The process is made simple, with borrowers logging onto the website and using the ‘My RightFit’ tool to determine the best plan for them. The website also offers a ‘ClearCost for Me’ tool, designed to let you know your exact terms so you’re not left with any surprises.

This lender also promises to consider more than just your credit score, instead opting to look at your “broader financial picture.”

Loan durations and APRs vary by state. You can click here to see the terms offered where you live. You’ll never be charged an origination fee or pre-payment penalty, no matter where you live.

Loans not available in: AK, CO, CT, HI, IA, ME, MD, MA, MN, NV, NH, NJ, NY, NC, OK, PA, RI, TN, VT, WV, or WY

These companies offer a variety of personal loans based on the diverse requirements of their customers. Be sure to research all your options before committing to a personal loan, as some companies will be better suited to your needs than others.

 

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