Adam McCann, Financial Writer
Yes, you can use a personal loan for credit card consolidation. Borrowers can use the funds from a personal loan for almost anything, including paying off credit card debt. Some lenders offer personal loans that they brand as “debt consolidation loans,” with their own set of interest rates. For example, LightStream’s overall personal loan APRs range from 3.99% to 17.48%, but their rates for debt consolidation loans range from 5.99% to 17.29%. Most lenders don’t designate the purpose of their personal loans, however, and you can use any personal loan to consolidate credit card debt.
Whether you get a standard personal loan or a “debt consolidation” loan, it will function the same way. You’ll get a lump sum upfront and will have to pay the loan back in equal monthly installments, with interest. Some good lenders include LightStream, Payoff and Best Egg.
Lenders with personal loans for credit card consolidation:
- LightStream: LightStream is one of the best lenders on the market, with APRs ranging from 5.99% to 17.29%, which is an extraordinarily cheap range. In addition, LightStream doesn’t charge origination fees, and they lend anywhere from $5,000 to $100,000. LightStream requires a credit score of 660+, according to third-party sources.
- Payoff: Payoff specializes in credit card consolidation loans. In fact, they don’t offer personal loans for other purposes. Their APRs range from 5.99% to 24.99%. The origination fee is 0% to 5% of the loan amount, depending on your credit. Payoff offers loans of $5,000 - $35,000. You’ll need a credit score of 640+ to qualify.
- Best Egg: Best Egg offers personal loans with APRs of 5.99% - 29.99%. Their origination fee is 0.99% - 5.99%, and it is deducted from the sum you get at the beginning. With Best Egg, you can borrow $2,000 - $50,000. Their loans require a credit score of 640+, according to third-party sources.
Those are just a few of the many options on the market. There are even lenders who will give loans to people with bad credit, such as Avant and FreedomPlus. However, people with bad credit aren’t likely to get interest rates that are worthwhile for credit card consolidation.
If you want to learn more about credit card consolidation loans and see what options are available to you, check out WalletHub’s credit card consolidation loan search tool.
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