Debt Consolidation Loans with a Fast and Easy Application

Lower your monthly expenses with debt consolidation loans online and organize your debt into one simple loan.

When you get in over your head with debt, there are some options available to help you climb out of the hole. One of the most popular options is to get another loan at a much lower interest rate.

The rates you get on these loans will be lower, so your monthly costs will be lower also. The money that you save is not the only thing to think about.

Additionally, you will be more organized with your finances and debt because you only have one loan to pay off.

No more worrying about paying off 4 or 5 different credit card accounts every month. 

Sometimes, multiple accounts can mean confusion. Consolidating gives you only one loan to focus on, which can make things much easier to manage. Of course, you also want that loan to come with better rates than your current debt carries.

But what type of debt consolidation loan is available to you?

And more importantly, which type is better geared toward your particular situation? This article answers those questions and more.

But, if you are ready to apply...

Here are 4 quick options for getting this type of loan...

  1. Your current/local bank - they should offer some type of personal loan for consolidating. But their rates and service might not be up to your satisfaction. Nevertheless, they are still worth giving a chance. You never know, they might surprise you.
  2. Avant.com - offers personal loans for consolidating as high as $35,000. Their site makes it super simple to apply online. And you can even check your rate without it affecting your credit. Because of their rates and the streamlined application, we have them as our top online firm. They also get top honors from many other sites that have reviewed them.
  3. Prosper.com - they let you borrow from individual investors for up to $30,000. Another site that's easy to use. They are what is known as a peer-to-peer loan network. The entire process can be done online so there isn't the usual hassle from dealing with a local bank.
  4. RateMarketplace.com - if you want to roll your debt into your home loan, you can get what's known as a cash-out refinance. Or you can go with a home equity loan/line of credit. Aside from the interest rates, customer service is the difference maker at the end of the day. Those who are not able to provide excellent customer service will fail to appeal to you. This company is fairly good at this because they spend time on it and make sure things are done in the right manner. Those who are looking for proper customer service are going to appreciate the value on offer here from a long time internet loan provider.
  5. PersonalLoans.com - allows you to get a personal loan of up to $30,000 with an easy online application. Simple and straightforward website. They don't lend money directly. Instead, they match you up with a qualified lender. If you are unsatisfied with the rates you get here, keep looking and shopping around.

Those are just a few quick options you can apply for online and offline. The firms listed offer one of the following solutions...

These loan types fall into 2 main categories known as: secured and unsecured loans. Secured simply means that you have an asset such as your home as collateral to cover the loan should you default.

If you don't offer the lender collateral, then it becomes an unsecured loan. These loan types are explained further down on this page.

Now, you might be saying to yourself "but I don't have good credit and can't get approved for a loan." If that is the situation you're facing, then you should go with another form of debt consolidation. You can choose to go with a firm that helps people consolidate without borrowing more money.

You'll be able to enter into a plan that puts all your debts together and starts you on the path to recovery - with no loan necessary. Many people have gone this route and it can work for you too. But only if you follow this simple guideline and pick a firm you can trust.

Ok, let's start our loan guide...

#1 Traditional Debt Consolidation Loans

With a traditional debt loan, you borrow money from a bank or credit union to pay off all of your debt. You then only have one lender to pay off every month.

As you are probably aware of by now, these loans are a little harder to qualify for nowadays. Lending standards are more stringent today than they were just a few years ago.

But if you have fairly good credit, you might still be able to qualify.

If you decide to go with this loan from a traditional lender, make sure you're getting better interest rates and terms than what you currently pay on your credit cards or other debt. That's the whole point of this loan...to lower your monthly costs by lowering the interest you pay.

Ask your bank or credit union if they offer consolidation loans and what the going interest rate is on their loan. Also ask about any other fees associated with this type of consolidation. If you're not sure of anything, don't be afraid to ask the company representative.

If the banker or credit union representative is hesitant to answer, take your business somewhere else.

#2 Consolidating With Peer-To-Peer Loans

Getting debt consolidation loans through peer-to-peer lending is growing in popularity.

Since today's banks are enacting stricter lending policies, people with large amounts of unsecured debt are having trouble paying it off under terms that they can afford. That's why p2p loans have taken off with people in debt. So what exactly is peer-to-peer lending?

Peer-to-peer lending involves an indebted person borrowing consolidation money from individual investors or an investing group.

Your credit report gets pulled and the risk you pose as a borrower will determine what your interest rates will be. You get to choose the payoff term such as one to five years.

This borrowing method sounds ideal for anyone and can be very enticing when you're in debt. 

When you select the peer-to-peer lending option, you'll most likely work with a company that brokers the deal (like prosper.com or a similar company).

This broker will assess your FICO score as well as your payment history. Some peer-to-peer brokerage companies complete underwriting reports to determine a borrower's default risk for these loans and other loan options.

Lenders often approve loan amounts that are as small as $1,000 to $2,000 as well as loan amounts that are as high as $35,000.

Also, the loan type will likely include a lending fee that the peer-to-peer lending company bases on the borrower's credit score.

What are the pros and cons of peer-to-peer lending?

Peer-to-peer debt consolidation loans benefit you because you gain the ability to lower your monthly costs and simplify your debts. Lenders also benefit because they earn an interest-based return on their investment. It's a win-win situation.

According to reports, this lending method has a lower default rate than a traditional consolidation loan.

Therefore, lenders can trust the investment type. If the borrower's credit score is low or if their debt to income ratio is high, then the person will likely face a high interest rate for the consolidation because a request for a low interest rate will likely be refused.

In addition, a borrower's credit history may limit his or her loan amount or other terms of the loan.

#3 Using Home Equity Loans for Debt Consolidation

If you're currently overwhelmed by credit card debt and need a way out, you can use a home equity loan to consolidate your debts.

What is a home equity loan?

The difference between the current value of your home and the remaining amount that's still unpaid is known as equity.

To take out a home equity loan, you put your house up as collateral in exchange for a lump sum that typically ranges from 75% to 90% of that equity. This is known as a secured loan because it's secured by the home's equity.

Also called a second mortgage loan, the home equity loan usually comes with a low fixed interest rate--one that's usually lower than that of credit cards and many other consumer loans.

What is the advantage of using a home equity loan?

There are several reasons why you might want to get the best debt consolidation loans through your home's equity. First, the interest rate on the equity loan is likely to be lower than that of any other loans you may have taken out.

When you use the home equity loan to pay off all of your other debt, you'll end up saving a lot more money in the end by paying much less interest, avoiding penalty fees, etc. Second, the home equity loan's interest rate is fixed, and your payments are always constant. You'll always know how much to pay and when to pay it.

Your other loans may have interest rates that increase over time or with late payments, so it's wiser to pay those off first. What are the risks of using a home equity loan to consolidate debt?

The major risk that you face is losing your house due to inability to repay the home equity debt loan. 

The bank which you borrowed from has the right to auction your home when you default. Be conservative about how much you need to borrow.

If housing prices fall, your equity will be recalculated, and you could be forced to pay back some of the loan if you already borrowed more than the recalculated limit.

Before going with this program, always be sure that you can make the payments on time. And always have an emergency fund.

You need a financial cushion just in case something happens with your income and finances.

So what's the final word?

Your decision should be between the first 2 options listed above. The home equity loan option should be your last choice.

Putting your home up as collateral makes this option more risky for you. You never want to put your house on the line if you don't have to. So the equity loan should be off limits unless you absolutely need to go that route.

Basically, it comes down to whether you feel more comfortable with traditional debt consolidation loans or you like the idea of peer-to-peer lending.

Either one you choose, you need to make sure you're getting the smart deal. Be absolutely certain you're getting the deal that lowers your monthly costs and accomplishes your debt reduction goals.

If it doesn't do that, don't be afraid to walk away. There's no law that says you must go with any offer.

Your Loan Options

  • Traditional Loans
  • Personal Loans
  • Peer-to-Peer Loans
  • Home Equity Loans

Not sure what the first step in reducing debt is? Want to know all there is about trimming your debt and monthly costs? Then check out our complete guide to getting out of debt.