Easy Debt Consolidation Loans Bad Credit – When high interest rates make it impossible to pay off debt effectively, debt consolidation offers a faster and easier way out. You combine multiple accounts into one affordable monthly payment with the lowest possible interest rate. That way, you can get out of debt faster because you’re not spending money on paying interest every month.
Debt consolidation loans are by far the most popular and well-known way of debt consolidation. You take out a personal loan with a low interest rate and use the funds to pay off credit cards and other debts.
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On the surface it sounds like the perfect solution. You can get yourself out of debt, keep your credit cards, and save a ton of money. When it works, it’s ideal.
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A debt consolidation loan only works if you can qualify for a low interest rate. In general, you need a rate of 10 percent or less for consolidation to be truly beneficial. Otherwise, the interest rate is not low enough to provide the reduction in payments and expenses that you need.
Debt challenges often lead to missed payments and collections, which drag down your credit score. Even simply having high balances close to a card’s credit limit can damage your credit. If this has happened, you may find it difficult to find good credit.
Financial challenges are not caused by debt – it is a symptom, not a cause. Debt challenges are usually rooted in larger financial problems, such as a lack of savings or an inability to maintain a balanced budget.
Taking a loan does not solve these problems. In fact, it can make your situation worse. If you can’t balance your budget or cover emergency expenses with savings, then you’ll likely have new credit card balances. You will then have new credit card debt on top of the loan to pay off.
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Fortunately, debt consolidation loans are not the only way to consolidate debt. There is another solution called a debt management program (DMP).
You enroll in DMP through a non-profit consumer credit counseling service. These organizations exist to help consumers get out of debt. They offer free debt and budget assessments and advise people on the best way to get out of debt.
If someone can’t get out of debt on their own (ie with credit), but isn’t to the point of filing for bankruptcy, a credit counseling agency offers a happy medium with a DMP.
Instead of qualifying for low interest rates based on your credit, the agency works with your creditors to reduce or eliminate interest charges. You don’t take out a new loan – you still owe your original creditors. But since you are going through credit counseling, they agree to minimize your rates.
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Because credit counseling agencies are non-profit organizations, they are required to work with the consumer’s best interest at heart.
In other words, I cannot recommend a debt management program unless it is the best solution to use in every financial situation. If there is a better option, they must tell you what it is, whether it is a consolidation loan, debt settlement, or bankruptcy.
This means you can get a free estimate from a certified credit counselor with no obligation. It’s the easiest way to get an expert opinion on the best option for getting out of debt. You have a clear answer, instead of guessing or hoping you made the right choice.
Another benefit that credit counseling offers is that it provides financial education and coaching as you get out of debt. The credit counseling team helps you create a budget, which includes money for savings, so you can start building an emergency fund.
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The team can also help you define your financial goals and set action plans to achieve them. You have access to free resources that teach you how to get good credit or plan for big life events.
This helps address those underlying challenges you face that got you into debt in the first place. You address the root causes of your debt so you can move forward and achieve long-term stability.
Consolidated Credit is one of the largest non-profit credit counseling agencies in the country. Since 1993, we have provided free credit counseling to more than 10 million people. We’ve also helped people consolidate over $9.75 billion in unsecured debt.
Case Study Eric from Whitier, CA “I am very satisfied with the service. Payments are always made on time and the APR is significantly reduced! ”
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Case Study Gerald from Valrico, FL “Consolidated Loan was amazing. They made getting out of debt less painful! Thank you. ”
Case Study Karee from El Paso, TX “Paying off my debt was easy and stress-free from the start. Everyone was very helpful and supportive. I never thought I would ever be debt free, but in less than a year I will reach my goal! ”
Case Study Christopher from New York, NY “Consolidated Credit helped me get out of debt quickly. Their customer service representatives are very friendly and understanding. Their debt management program is the best. ”
This content is based on accredited financial data collected from reputable sources, such as government websites, credit bureaus and non-profit organizations. All articles are written by certified credit counselors and fact-checked by certified financial experts.
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Our team strives to provide educational content that fully informs readers about all their options related to debt, credit and personal finance. Our goal is to provide readers with the information they need to make their own informed financial decisions.
This article contains references that provide sources for the financial data we used. Numbers in parentheses [1, 2, 3] are clickable links to each referenced data source or study.
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Consolidated Credit has helped over 10.2 million people get out of debt. Now we are here to help you.
Your counselor will help you complete and review your debt and budget analysis, then discuss the best options for getting out of debt. If a debt management program is right for you, your counselor can also help you enroll as soon as you’re ready. Getting a bad credit debt consolidation loan can be challenging, but you have several options to improve your chances of approval. You might consider online banks or credit unions with less stringent qualifications, hiring an underwriter with strong credit, or using collateral for your loan.
At , one of our priorities is education about consumer loans and finances. This post may contain links and references to one or more of our partners, but we provide an objective view to help you make the best decisions. For more information, see our editorial policy.
We’ve done the research so you don’t have to. Our technology works directly with financial institutions to match you with offers from our partners that suit you, meaning you’re more likely to qualify for products that suit you. Our list is more personalized than other sites because we review lender requirements before showing you offers. We find your best matches using things like your credit profile and your spending habits.
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Your loan amount will be determined based on your credit, income and certain other information provided in your loan application. Not all applicants will qualify for the full amount. Minimum loan amounts vary by state: GA ($3,100), HI ($2,100), MA ($7,000), NM ($5,100), OH ($6,000). If you accept your credit by 5:00 PM EST (not including weekends or holidays), your funds will be sent the next business day. Loans used to finance education expenses are subject to a 3 business day waiting period between loan acceptance and funding in accordance with federal law. When you check your rate, we check your credit report. This initial (soft) inquiry will not affect your credit score. If you accept your rate and proceed with your application, we do another (hard) credit inquiry that will affect your credit score. If you take out a loan, the repayment information will be reported to the credit bureaus. Although educational information is collected as part of Upstart’s rate verification process, neither Upstart nor its bank partners have a minimum education requirement to qualify for a loan. This offer is subject to final approval based on our review and verification of financial and non-financial information. The loan rate and amount are subject to change based on the information received in your full application. This offer may only be accepted by the person named in this offer, who is of legal age to enter into a credit extension agreement, a US citizen or US permanent resident and a current US resident. Duplicate offers are void. The closing of your loan is subject to meeting our eligibility requirements, our verification of your information and your agreement to the terms and conditions on the www.upstart.com website. The whole range
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