(Familiarize yourself with credit scoring ranges and what is considered a good score; typically, anything above 700 in the FICO model is considered good.) Your scores will also help lenders determine what APR you qualify for.If your score is in the good or excellent range, you probably have a strong chance of getting approved for a personal loan with a low APR.These results, based on the information provided by you, represent an estimate and you should consult your own financial advisor regarding your particular needs.Many loan products come with origination fees or prepayment penalties that could be quite steep.But if your credit is in the fair to poor range, it may be a little trickier to consolidate your debts.However, there are loans geared to people with less established credit or lower credit scores.Some people use personal or debt consolidation loans to consolidate high-interest debt, such as credit card bills and payday loans.
In this piece, we'll focus on how to get a debt consolidation loan and whether it's the right choice for you.
List out how many debts you're paying each month, and calculate the total dollar amount of debt you need to consolidate.
This will help you understand how much you need to borrow to consolidate your existing loans and give you an idea of the interest rate you need in order to save money moving forward.
For some people, juggling multiple payments with different creditors can be too much to manage.
Enter debt consolidation, a method of debt refinancing that involves taking out one new loan to pay off others.Just keep in mind that applicants with lower credit scores are often approved for higher interest rates on their new debt, so it's important to pay attention to the rates when you apply.