Average Debt Consolidation Interest Rate (APR): By Credit Score
| Credit Class | Average Interest Rate |
|---|---|
| Excellent (720 – 850) | 4.52% – 20.57% |
| Good (680 – 719) | 6.67% – 28.33% |
| Average or Fair (640 – 679) | 7.05% – 30.32% |
| Poor (300* – 639) | 15.06% – 36.00% |
Secondly, do consolidation loans hurt your credit score?
Consolidating your debt can lower your monthly payments, but it can also cause a temporary dip in your credit score. Two common debt consolidation approaches include getting a debt consolidation loan or a balance transfer card.
Likewise, what is the best bank for a debt consolidation loan?
Compare The Best Personal Loans for Debt Consolidation
| Lender | Fixed APR |
|---|---|
| Marcus by Goldman Sachs Best Overall and Low Fees | 6.99%-19.99% |
| Discover Personal Loans Best for Flexible Repayment Options | 6.99%-24.99% |
| Payoff Best for Consolidating Credit Card Debt | 5.99%-24.99% |
| LightStream Best for Low Rates | 2.49%-19.99% with autopay* |
Is it better to get a personal loan or debt consolidation?
You might find that with a debt consolidation loan, interest rates are lower than your current credit card. However, interest rates will likely be higher than other loan options, such as a personal loan. Personal loans are great if you need additional cash flow for specific items, life events or bills.
Are Consolidation Loans Worth It?
Debt consolidation rolls multiple debts, typically high-interest debt such as credit card bills, into a single payment. Debt consolidation might be a good idea for you if you can get a lower interest rate. That will help you reduce your total debt and reorganize it so you can pay it off faster.