Why You Should Consolidate Your Credit Card Debt with a Personal Loan

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The average American household has $15,675 in credit card debt. With high-interest credit cards, it can be difficult to make any progress on the principal and you can end up paying hundreds or even thousands in interest payments.

If you are struggling to manage your debt and pay off your balance, consolidating your credit card debt with a personal loan might be for you.

What is Credit Card
Consolidation?

When you consolidate your debt with a personal loan, you take out

a loan equal to what you owe on all of your credit cards, simplifying your debt. Instead of juggling multiple accounts, you consolidate your debt into one place and have one easy payment. Personal loans can have lower interest rates and more favorable repayment terms than credit cards, so you can make more progress on paying off your balance and save money over time.

Credit card consolidation can help you become debt-free more quickly, but it only works if you are dedicated to paying off your debt and are willing to stick to a budget and a repayment plan.

Benefits of Consolidating with a Personal Loan

When you consolidate your debt, you can save significant amounts of money in interest. Borrowers who took out a personal loan via Lending Club to consolidate debt or pay off high-interest credit cards reported interest rates 24 percent lower than what they were paying on their debt.1

Beyond potentially lower interest rates, personal loans for debt consolidation offer many other benefits:

  • Fixed interest rates: Personal loans have fixed interest rates and fixed monthly payments, making it easier to create and maintain a monthly budget. You also have the peace of mind in knowing that your rates will not skyrocket next year. With the stability of a personal loan, you can build a financial plan that ends with you being debt-free within a specific timeframe.
  • Quick processing: Unlike other forms of credit, personal loan applications are processed and distributed quickly. Once you submit your information, you can see the rate you qualify for in minutes. If you find an offer that works for you, the funds are deposited into your account in as little as 7 days, letting you get started with consolidating your debt right away.
  • Personalized terms: The great thing about applying for a personal loan through Lending Club is that you can check your rate to see what offers you qualify for without impacting your credit score. If you decide that a personal loan is the right choice for you, you can choose the offer that makes the most sense for you and your budget.

If you decide that a personal loan for credit card consolidation is right for you, you can apply online in minutes for free!

1 Based on responses from 7,715 borrowers in a survey of 122,975 randomly selected borrowers conducted from 1/1/16 - 3/31/17. Borrowers who received a loan to consolidate existing debt or pay off their credit card balance reported that the interest rate on outstanding debt or credit cards was 20% and average interest rate on loans via Lending Club is 15.2%. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. Best APR is available to borrowers with excellent credit.

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Checking your rate will not affect your credit score.