HomePersonal LoansWhat Is A Debt Consolidation Loan
Advertising Disclosure Acorn Finance receives compensation from some of the companies featured on our website, which may influence the presentation and order of the offers shown. Please note that not all loan options, savings products, or lenders are represented on our site.

What Is A Debt Consolidation Loan?

Compare monthly payment options from several lenders in under 2 minutes.

How much would you like to finance?

Consolidation Loan Definition

A consolidation loan is a great way for consumers to get out from under debt and try to turn their finances around when they have maybe taken on more than they can handle. It can be too easy sometimes to take on new debts without paying off old ones, and someday it may get to the point where you are struggling to make all your monthly payments. Additionally, the interest that you may be accumulating while only making the minimum payments across several maxed-out credit cards can sometimes be astronomical.

Get Started

Compare rates from top lenders

Learn More About What Is A Debt Consolidation Loan?

While a debt consolidation loan can be a smart financial move, that’s intended to save you money, it could 

initially impact your credit score. The process of obtaining a debt consolidation loan generally requires a hard credit pull. A hard credit inquiry has the potential to impact your credit score temporarily. Additionally, there may be some overlap between opening the new loan and closing out the old loan. This can cause it to look like you are holding more debt than you really are. Lastly, opening a new credit account could lower your average “credit age,” which can result in a credit score impact. The good news is that these impacts should only be temporary and over time, a debt consolidation loan can help improve your credit score. 

Here are some ways a debt consolidation loan can improve your credit score:

  • Potential to lower your credit utilization rate
  • Improved payment history over time
  • Help stay organized so that you don’t accidentally miss payments
  • Earn a paid-in-full loan on your credit score 
  • Pay your loan off faster

To mitigate negative credit score impacts, consider these tips:

  • Keep credit accounts open, but keep the balances very low.
  • Use all credit responsibly.
  • Monitor your credit report regularly to stay current on any changes and areas needing improvement. 
  • Choose a competitive debt consolidation loan.
  • Examine the numbers to ensure the new loan is cost-effective with payments that fit your budget.

Are debt consolidation loans hard to get?

Debt consolidation loans can be about as hard as any other financial product to qualify for - but what does that mean exactly? Lenders can look at several areas of your financial profile when determining debt consolidation loan eligibility. Factors such as credit score, income, utilization, and so forth can be considered. Since you already have credit, you may be one step ahead when it comes to qualifying. When you apply, be sure your intended use of the loan is clear. Some lenders may specialize in debt consolidation loans and therefore, offer a more user-friendly process. 

How long does debt consolidation stay on your record?

A debt consolidation loan can stay on your record for up to 7 years after your loan is repaid, depending on how it is reported by the lender as well as the credit bureau. As soon as you open a new credit account in the form of a debt consolidation loan, it will likely appear on your credit as a new installment loan account. After your account is paid off in full at the end of your loan, this account should transition from an open account to a “closed” or “paid” account. Paid loans can boost your credit score as well as your history. Typically, this does not negatively impact your credit unless you have missed or late payments associated with your account. 

How do I know if I qualify for debt consolidation?

The best way to find out if you qualify for debt consolidation is to check offers. You can do this without impacting your credit score and without any commitment whatsoever. How? Acorn Finance can help. At Acorn Finance, you can check offers from our network of top national lenders in seconds.

Before you get prequalified, though, it’s a good idea to utilize a credit monitoring app or website to see where your credit stands. Whenever possible, it is advisable to improve your credit where you can before applying for a loan. While consolidation loans for bad credit borrowers may be offered by some lenders, they may not come with favorable offers. Consolidating debt can help you regain control over your finances and pay down debt while saving money. However, choosing a debt consolidation loan with higher costs or payments can have an adverse effect. 

What are the best loans for debt consolidation in [September 2023]? 

The best loan for debt consolidation will be situationally dependent. There are many factors that make a loan offer or structure the best for you, including loan amount, repayment period, interest rates, and more. When you request a smaller loan amount, you may have a broader selection as larger loans can be more difficult to obtain - leaving you with fewer choices. Casting the widest net possible when loan shopping can give you the best shot at reeling in the best debt consolidation loan for you. 

How do you compare debt consolidation loans in [September 2023]?

You can compare debt consolidation loan offers side by side at Acorn. Take advantage of our platform to check personalized debt consolidation loan offers with no credit score impact. Alternatively, you can shop for offers from your local bank or credit union. The lender that holds your current loan may have options to offer as well. Regardless of how you shop for debt consolidation loans, be sure you know what options are available and how they work before making a commitment.

Pros and cons of lenders for Debt Consolidation Loans:


Minimum qualifications: 

  • Minimum credit score requirement of 660 or above 
  • Minimum income requirement of $50,000/year


  • No origination fees
  • Funding as soon as one business day on approved loans, although funding times can vary
  • Competitive loan offers
  • Allows co-signer
  • Large personal loans available 
  • Flexible repayment periods up to 12 years


  • Strict qualification requirements
  • No access to pre-qualify through the LightStream website (When applying directly, you can get pre-approved but not pre-qualified, therefore, you may be subject to a hard credit pull. To get pre-qualified with LightStream, check offers through Acorn Finance to see if you qualify.)
  • No direct payment to creditors for debt consolidation loans


Minimum qualifications:

  • Minimum credit score requirement of 680 or above 
  • Minimum income requirement of $50,000/year


  • Flexible loan amounts and repayment terms
  • No origination fees
  • Competitive interest rates
  • Funding as soon as one business day on approved loans, although funding times can vary
  • Allows cosigner applications
  • Unemployment protection available


  • High credit score requirement
  • Approvals may take 3 days or more

Best Egg

Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • No minimum income requirement 


  • Fair credit scores can qualify
  • No minimum income requirement
  • Same or next day funding available, although funding times can vary


  • Not available in some states
  • Origination fees between 0.99% and 6.99%
  • Higher APRs


Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • No minimum income requirement 


  • Low threshold for credit score
  • No minimum income requirement
  • Flexibility to change payment dates
  • Offers peer-to-peer lending


  • Long funding times
  • Origination and late fees may apply
  • No rate discount for autopay is available
  • Restrictive repayment periods
  • Funding may take about 5 business days 


Minimum qualifications:

  • Minimum credit score requirement of 560 or above 
  • No minimum income requirement


  • Low credit score requirement
  • No early payoff penalty
  • Joint applications allowed
  • Funding as soon as one business day on approved loans, although funding times can vary


  • Origination fees between 2.9% to 8%
  • Higher APRs, especially for subprime borrowers

Axos Bank

Minimum qualifications:

  • Minimum credit score requirement of 700 or above 
  • Minimum income requirement $48,000/year


  • Low origination fees
  • Mobile app to manage loans
  • Fast funding times
  • Funding as soon as one business day on approved loans, although funding times can vary


  • High credit score requirement
  • Origination fee up to 2%

OneMain Financial

Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • Minimum income requirement $7,200/year


  • Low credit score requirement
  • Offers secured loan option
  • Low income requirement
  • Flexibility to choose your payment date
  • Fast funding times



  • High interest compared to similar lenders
  • Origination fee between 1% – 10% (or flat fee up to $500 depending on state)



Minimum qualifications:

  • Minimum credit score requirement of 600 or above 
  • Minimum income requirement $30,000/year


  • Low origination fees
  • Relaxed credit score and income requirements
  • Same or next-day funding is available, although funding times can vary


  • No joint applications
  • High loan costs
  • Short repayment periods 

Check rates from these top lenders and more at Acorn Finance!

Lenders outside the Acorn network to consider:

Lending USA

Qualification requirements:

  • Credit score of 620 or above


  • No interest will be charged to the principal balance if your loan is repaid within six months
  • Fast funding
  • Small loans amounts available (as little as $1,000)
  • High approval rates 


  • Higher APRs than some other lenders

Universal Credit

Qualifications needed: 

  • Credit score requirement of 560 or above


  • Low credit score requirements


  • Higher APRs than some other lenders

Reprise Financial

Reprise Financial can help borrowers find personal loan offers that meet their needs. In order to help borrowers obtain funds quickly, Reprise works to streamline the personal loan process. With customized payment options and fixed rates, check personal loan offers at Reprise Financial.

Read more - FAQ

What is a consolidation loan and how does it work?

An added benefit of a consolidation loan is that you may have a lower monthly payment after obtaining the loan compared to when you needed to pay several creditors various amounts across different accounts each month.
However, it is important to know that you do not need to be falling behind on your debt payments to want to obtain a debt consolidation loan. A debt consolidation loan could be used by a borrower who may be able to keep up on all their payments each month but may feel overwhelmed trying to keep track of all the different due dates. Even with autopay, payment amounts on credit cards can change and it may be difficult to keep track of exactly how much each account is taking from your checking account each month. With a personal debt consolidation loan, you can pay off all of those debts and have one single fixed monthly payment that may never change throughout the loan duration. You will always know exactly how much you will need to pay each month, and if you have a lower monthly payment, you can use that surplus to create some savings, invest, or make extra payments to pay down your debt sooner. If you focus on your finances, make some spending cuts to save money, and do not take on any new debt, you could potentially be debt-free once the loan is paid in full.
Another reason that you may want to take on a debt consolidation loan is that you have worked hard on your credit and now your credit score is significantly higher than when you first took on the original debts. With a much higher credit score, you may be able to qualify for a debt consolidation loan with a much lower APR than your existing debts. Because of this, taking on a new loan with a lower APR can give you an opportunity to save quite a bit of money in the long run by requiring you to pay less interest during the loan duration and by setting a firm pay-off date. When you only make the minimum payments on your credit card accounts, you could be stretching out your debt payments for months or even years longer than they need to be, which then becomes more and more expensive the longer you take to pay off your debt.
For whatever reason that you decide that debt consolidation may be right for you, the first thing you may need to consider is which type of debt consolidation loan is the best considering your circumstances. There are several different types of debt consolidation loans that each come with their own advantages and disadvantages and that may work for some consumers while others may not. For example, a home equity debt consolidation loan can only work for a borrower who owns their own home and who has at least 20% equity built into their home.
Now keep in mind that debt consolidation is completely different from debt settlement. You may hear these two phrases used interchangeably, which is incorrect. Make sure you understand the difference between these two processes before reaching out to any entity that claims to be a debt settlement company. A debt settlement company is an entity that negotiates lump-sum payments to each of your creditors in exchange for charging you a fee somewhere between 15% to 20% of the total amount.
A debt consolidation process is a process that involves obtaining a new loan from an official lending institution to pay off all of your current debt, and in exchange, you make one single monthly payment plus interest that is equal to the market rate you qualify for based on your credit score. Essentially, debt settlement companies could be considered somewhat predatory while debt consolidation loans through certified lenders are considered more safe, secure, and an official way to pay off existing debts. So, what are the different types of debt consolidation loans available to you?
Here is a list of some of the most common ways borrowers like yourself choose to obtain a debt consolidation loan to pay down existing debt and simplify their finances.

Home equity loan: If you have at least 20% equity built up into your home, you can tap into that equity through a home equity loan or a home equity line of credit. Equity is essentially how much your home is worth versus how much you have paid on your current mortgage. By subtracting the mortgage balance from the current home's fair market value, you can determine how much equity you have. If your equity is greater than 20%, a home equity loan provider may allow you to borrow up to 80% or 90% of your total equity in a separate second mortgage home loan.

You do not have to borrow the entire 80% or 90% of your equity and instead, you can opt for a smaller amount. Keep in mind that if you do take out a home equity loan, you will be taking on a second monthly payment in addition to your current mortgage payment. This may affect how much equity you would like to borrow against based on how high the monthly payments could potentially be. Common home equity loan terms come in 5, 10, or 15-year fixed-rate loans. A fixed-rate loan comes with a fixed APR and a fixed monthly payment.

One of the best things about a home equity loan is that you can access larger loan amounts at lower interest rates compared to a personal loan. That means if you qualify for a larger home equity loan, you may be able to not only consolidate your existing debts, but you also may be able to fund a home improvement project, pay for going back to school, or even use some funds to start up a new side gig to create a new revenue stream around a passionate hobby of yours. The reason that it is easier to qualify for large amounts of cash with a home equity loan is that you are using your equity and essentially your home as collateral to secure the loan. By using your home as collateral, you may be putting yourself at risk of losing your home if you are unable to make payments, however, you can typically obtain larger amounts and lower interest rates in exchange.

Home equity lines of credit: HELOCs are very similar to home equity lines of credit, however, instead of one large lump sum payment, HELOCs typically contain a draw period and a repayment period. For example, a lender may qualify you for something like 85% of your equity and establish a credit limit. Instead of getting all the money upfront, you are allowed to draw against that credit limit and take as much or as little as you would like while the draw period is in the draw phase. During that time you can make regular monthly payments on the amounts borrowed or you can choose to only make interest payments. Once the draw period comes to a close, you then enter the repayment period. If you were only making interest payments, then monthly payments may dramatically increase to make up for the smaller monthly payments you were paying previously. If you were making regular payments, then you may only see a slight change in the required monthly payments.

A typical HELOC may have a draw period of 10-years and a repayment period of 20-years. If you are making regular monthly payments during the draw period, you are also constantly replenishing your credit limit and increasing the amount you could potentially withdraw from. Additionally, if you are making regular monthly payments, a lender may offer to allow you to renew the HELOC and extend the draw period. Like a home equity loan, a home equity line of credit may put your home at risk if for some reason you are unable to make the payments.

Cash-out refinance: A cash-out refinance may be a good way to get your hands on some extra cash to consolidate all your existing debts. Essentially, if you are already looking to refinance your home in order to take advantage of lower interest rates, you can ask for a new mortgage that is for an amount that is greater than your current mortgage. Once the cash-out refinance is complete, you can take the bulk of the funds to pay off your current mortgage and then take the surplus funds to pay off all your creditors.

Credit card balance transfer: If it is only credit card debt that you are looking to refinance, or if some of your creditors accept credit card payment, then depending on your credit score, you could always apply for a new credit card that comes with a 0% APR introductory rate. Typically these promotional periods can span 12 to 18-months. Although you may still be subject to a balance transfer fee, you can take advantage of the 0% promotional period to pay down as much of that debt as possible before interest kicks. Again, in order for this to work, you may have to already have a good or even excellent credit score.

401k loan: If you have a 401k retirement account, you may be able to borrow against your retirement savings as a form of debt consolidation. However, many financial advisors may recommend only using a 401k loan as a last resort. The main reason for this is any funds that are removed from your 401k could potentially miss out on large gains that can benefit your retirement. Also, if for any reason you are unable to pay back the loan, you most likely will have to pay early withdrawal penalties and count the amount unpaid as income on your taxes.

Personal debt consolidation loan: Personal debt consolidation loans are one of the most simple and commonly used forms of debt consolidation. Applying for a personal debt consolidation loan should be a simple and straightforward process. In some cases, lenders may just offer personal loans that can be used to consolidate debt. In some other cases, lenders may offer debt consolidation loans with direct payment to creditors. This means that you apply for the loan and notify them of the accounts you wish to consolidate. If approved, the lender will pay off the accounts and roll the debt into the new loan. The simplicity and less strict qualification requirements of personal debt consolidation loans make them a preferred choice.

If you are considering debt consolidation, then you may want to take some time to consider all of your options. Some options may be better than others depending on your credit history, income, whether or not you own your home, and what your financial goals are. Again, one of the most common forms of debt consolidation is a personal debt consolidation loan. If you may be considering a debt consolidation loan, how do you know which lenders offer the best consolidation options? Here is a breakdown of some of the most trusted online lenders who specialize in debt consolidation.

Best Consolidation Loan Options:

Top pick for: large personal loans
Qualifications: LightStream may be a good debt consolidation lender for a borrower who has a large amount of debt and who has a credit score of at least 660 and a minimum income of $50,000.
No fees
Joint applications are allowed
Rate discount for signing up for autopay


No prequalification application on the LightStream website

High minimum credit and income requirements

Inflexible due dates

No direct payment to creditors

Why choose: LightStream offers debt consolidation loans of up to $100,000 with 2 to 12-year repayment terms and competitive interest rates for those who qualify.


Top pick for: debt consolidation loans for good credit

Qualifications: SoFi requires a minimum credit score of 680 and a minimum income of $50,000 for a personal debt consolidation loan between $5,000 and $100,000.


Zero fees. No origination fee, late fee, or early pay-off penalties

Co-applicants are allowed to increase their chances of qualifying or to access lower interest rates

Direct pay available for select creditors


Higher credit score and income minimum requirements

Co-applicant loans can take two weeks longer to be approved

Why choose: If you are having debt problems, SoFi does offer some free financial planning and mentoring services.


Top pick for: debt consolidation loans for fair credit

Qualifications: Best Egg requires a minimum credit score of 600 for 3 and 5-year debt consolidation loans that range from $2,000 to $50,000.


Offers direct payments to creditors for debt consolidation loans

Flexible due dates

No early pay-off penalty


Higher than average APRs

Charges an origination fee

Does not permit co-applicants

Why choose: BestEgg is well-known for having good customer support.


Top pick for: peer-to-peer loans $40,000 and less

Qualifications: For a 3 or 5-year debt consolidation loan for an amount between $2,000 and $40,000, Prosper borrowers will need a minimum credit score of 600.


Allows joint applications

Offers debt consolidation loans of up to $40,000


Charges an origination and late fee

Not available in every state.

Why choose: Prosper may be a good lender option if you want to manage your account and your loan from your mobile device using an app.


Top pick for: debt consolidation loans for bad credit

Qualifications: Upgrade requires a 560 minimum credit score for debt consolidation loans that range from $1k to $50k. Loan terms can be anywhere from 3 to 7-years.


Wide range of loan amounts and loan repayment periods

Ability to prequalify on the Upgrade website with no impact on your credit score

Offers to pay creditors on your behalf for debt consolidation loans

Secured loan options are available for poor credit borrowers or for any borrower hoping for a lower APR


Higher APRs than other lenders

Charges an origination fee

Not available in all 50-states.

Why choose: Upgrade specializes in working with borrowers with bad credit.

Axos Bank

Top pick for: debt consolidation loans for excellent credit

Qualifications: Axos requires a minimum credit score of 700 and a minimum income of $48k for debt consolidation loans that range from $5k to $50k.


Fast approval and funding

No early payoff penalty


Charges an origination fee

Why choose: Axos is known for helping borrowers refinance existing loans or complete the debt consolidation process.

OneMain Financial

Top pick for: debt consolidation loans for credit challenged borrowers

Qualifications: A minimum credit score of 600 is required for a personal debt consolidation loan between $1,500 and $20,000.


Accepts low credit and low-income borrowers

Offer a secured loan option for easier qualification and lower interest rates

Offers access to a mobile app to manage your account, make payments, and check your VantageScore


Maximum loan is $20,000

Higher APRs

Why choose: If you need fast funding, OneMain Financial can help you with that.


Top pick for: low income borrowers

Qualifications: With a minimum credit score of 600 and a minimum income of $30k, you may be able to qualify for a 2 to 4-year personal debt consolidation loan for an amount between $2,000 and $25,000.


Lower credit score requirements

Fast loan approval and funding times

Offers smaller loans with 2 to 4-year repayment terms


No co-signer or secured loan options

Higher than average APRs

Charges an origination fee of up to 6%

Why choose: LendingPoint is good for borrowers looking for a smaller amount and a more short term loan.

What is the purpose of a consolidation loan?

The main purpose of a debt consolidation loan is to combine multiple debts into one single monthly payment by obtaining a new loan with much more favorable terms. Once the new loan is acquired, you can then pay off all your existing high-interest debts and exchange them for a single debt with ideally a lower interest rate and a lower monthly payment. If you are able to obtain a lower monthly payment compared to the total amount you were paying per month between all the different creditors, you can then take any extra funds each month and devote them to paying down your debts faster or building up savings.

What qualifies you for a consolidation loan?

The kind of qualifications that are necessary for a consolidation loan varies by the loan type and the lender. For example, a home equity loan used for debt consolidation is going to have different qualification requirements than a personal loan. Obtaining a 0% APR credit card with an 18-month promotional period is also going to have different qualification requirements than both the home equity and personal loan. Let us take a closer look at these three debt consolidation methods to get a better understanding of what lenders may be expecting from a potential borrower.
Home equity loan or home equity line of credit: To qualify for a home equity loan or home equity line of credit you may need at least 20% equity in your home, a good credit score, a lower debt to income ratio, sufficient income, and reliable payment history. A good credit score may be better if you have a credit score over 700, however, a credit score in the mid-600s may be enough to qualify for a home equity loan or HELOC since you are using your home as collateral to secure the loan. When it comes to debt-to-income ratios, you should aim for a debt-to-income ratio that is below 36%, however, some lenders may go as high as 43% or 50%.
When it comes to income, most lenders will consider your income when they calculate your debt-to-income ratio, however, they also want to see a consistent employment history with a consistent monthly income. The longer your employment history, the better. When it comes to reliable payment history, yes lenders will get an idea of your payment history when they see your credit score, however, once they have the hard inquiry credit check in front of them, they may take an even closer look at your payment history to identify any potential risk.
Personal debt consolidation loan: To qualify for a personal loan for debt consolidation purposes lenders can look at your credit score and credit history, your income, your debt-to-income ratio, and even some of your personal finances to get a better idea of how you manage your money. When it comes to credit score and credit history, most lenders are going to want to see a minimum credit score above 600 with no recent negative credit events in your credit history.
Negative credit events may include a previous loan default, home foreclosure, car repossession, or bankruptcy. These negative credit events do not automatically disqualify you, however, lenders may want to see that these types of events happened long ago and since then you have a near-perfect payment history. When it comes to that 600 minimum credit score, some lenders may require an even higher credit score between 600 and 700, and some lenders may even go lower than 600.
Minimum requirements for a personal loan depend entirely on the lender. When it comes to your income and your debt-to-income ratio, lenders are going to want to see a stable employment history with a lower debt-to-income ratio. You want to aim for a DTI that is below 36% including the loan you are applying for. When it comes to your personal finances, some lenders like to see evidence of savings or that you have the ability to save money. This is why sometimes a lender may request bank statements to review during the loan application process. When you are ready to apply for a personal debt consolidation loan, you most likely will need to submit documents that verify your identity, employer, income, and address. Once the loan is approved, loans can be funded in as little as 1-2 business days, although funding times can vary.
Zero-interest credit card: To qualify for a new 0% APR credit card, you may need a minimum credit score of 700 for the best chances of qualifying. Once you are approved for the new credit card, the 0% APR is typically an introductory rate. The introductory rate can span for a 12 or 18-month promotional period depending on the credit card company. Although the credit card company may charge a balance transfer fee, once you have access to your new line of credit, you should transfer all the balances of your other high-interest credit cards onto the new card.
Again, qualification requirements differ based on the lender type and the form of debt consolidation you are seeking. For the most accurate information about the costs associated with debt consolidation, you may want to prequalify for a home equity loan or a personal loan. Once you prequalify, you can begin to review personalized credit offers from various lenders.

Does credit consolidation ruin your credit?

No, debt consolidation should not ruin your credit. In fact, it can actually help you to repair bad credit and increase your credit score over the duration of the loan. During the application process, lenders can do a hard credit pull. Hard inquiries can sometimes cause a credit score to drop about 5-points, but typically, no more than that. Also, if you take out a larger personal loan that is for an amount greater than your current debts, you could be adding to your overall debt amount which could also adversely affect your credit score. Once monthly payments kick in, you should make sure you make every effort to submit each of your payments on time and in full.
If you are late on any payments or you miss a payment, your credit score could start to decrease quite a bit. Payment history accounts for 35% of a borrower's credit score. Therefore, any late or missed payments carry a lot of weight to dragging down your credit score. However, the opposite is true as well. If you continue to make all your payments on time, not only can you make up for the immediate dip you saw in your credit score once when you first took out the loan, you can begin to see an increase in your credit score the more payments you make on time and the lower the loan balance gets.

How long does debt consolidation stay on a credit report?

This is where some people get confused about the definition of debt consolidation versus debt settlement. If you obtain a debt consolidation loan, it is treated no differently by the credit reporting agencies than a regular personal loan. Make all the payments on time and pay off the full loan balance and you are good. A debt settlement is treated differently. A debt settlement is an offer to pay a delinquent account at a discounted rate to resolve the matter and remove the account from delinquency on the credit report. Once a debt is settled, although the account may no longer be considered delinquent, the previously missed payments and other negative credit events tied to the account can stay on your credit report for up to 7-years from the date the account was first reported delinquent. This date is referred to as the original delinquency date.

How long after debt consolidation can I buy a house?

Once you take on a new debt consolidation loan, you may want to wait a minimum of a few months to get some on-time payments under your belt to boost up your credit score before starting to look for a new home mortgage.

Can I still use my credit card after debt consolidation?

Yes, you can still use your credit card after debt consolidation. Debt consolidation does not close your credit card accounts, it only wipes the balance. However, if you start using the cards again and you are paying on the loan, there is a good chance you are going to increase your debt burden even more.

How can I put all my debt into one payment?

The debt consolidation process takes all of your debts and combines them into monthly payments through a new personal loan.

Is there a government debt relief program?

There are no government programs that forgive or reduce consumer debt. Instead, there are 501c-3 nonprofit credit counseling services that can help you to address your debt issues.

Is refinancing the same as consolidation?

If you are combining several debts into one, that is consolidation. If you are replacing one debt for another debt with a lower interest rate and more favorable terms, that is refinancing.

How does a consolidation line of credit work?

If you open a personal line of credit, you can use some or all of your credit limit to pay off existing debt which effectively would be a form of debt consolidation.

Can I buy a car after debt settlement?

Yes, you should be able to still buy a car after a debt settlement depending on how severe the settlement was and how much it impacted your credit. If you do try to get a car loan after a debt settlement, then you may have to pay higher interest rates and fees.

Can I cancel my debt consolidation?

If you are enrolled in a debt management program, then yes you may be able to cancel at any time. However, if you take a personal debt consolidation loan, sign the loan agreement, and accept the funds, you may not be able to cancel. However, if you do not spend any of the money, you may be able to pay off the loan in full with the funds immediately. Just be careful of early pay-off penalties.

Does debt consolidation give you money?

If you add up all the monthly payments you are making on all of your existing debts, and compare it to what your new monthly payment might be when you take on a debt consolidation loan if the new payment is less, then yes, you will have more money in your pocket each month. Thinking long-term if total loan costs are lower with a debt consolidation loan, you can also save money.

$10000 Loan Calculator


Find the loan you're looking for

Table comparing monthly payments, APRs for approved personal loans.
See your options
Take a few minute to answer few questions, and we'll match you with the right range of lenders to consider
Choose your loan
Find your favorite marketplace of offers and apply directly with the lender you prefer
Do your project
If you're approved, use your funds to cover all your costs now, and pay the lender back month by month

What can I do with a $10,000 personal loan?

A $10,000 personal loan has a number of uses, including (but not limited to):
Home improvement Buying a car Wedding costs
Debt consolidation Medical bills Startup business costs

Still have questions?

Does consolidation hurt your credit?

One home, endless possibilities


Personal Loan Information