What Makes a Good Debt Consolidation Loan
A debt consolidation loan combines multiple high-interest debts into a single loan at a lower rate. Done right: simplifies payments, saves on interest. Done wrong: extends the timeline and costs more total.
Before You Apply
Advertised rates are for 720+ credit scores only. Origination fees of 5% on $20,000 = $1,000 taken off the top. Always prequalify with a soft pull first — it does not affect your credit score.
The 7 Best Options of 2026
1. LightStream — Best for excellent credit (700+). APR 6.99–25.99%, no origination fee, same-day funding. Rate Beat guarantee: they beat any competitor's rate by 0.10%.
2. SoFi — Best member benefits. APR 8.99–29.99%, no fees. Unique: unemployment protection pauses payments if you lose your job, plus free financial planning sessions.
3. Marcus by Goldman Sachs — Best no-fee option. APR 6.99–24.99%. On-time payment reward: defer one payment after 12 consecutive on-time payments.
4. Upgrade — Best for fair credit (580–660). APR 9.99–35.99%. Approves scores as low as 580 when others won't. Higher fees but accessible.
5. Discover — Best for direct creditor payment. APR 7.99–24.99%, no origination fee. Pays up to 10 creditors directly so funds cannot be misused.
6. Avant — Best for 550–580 scores. APR 9.95–35.99%. Only proceed if the math confirms savings vs. your current rates.
7. Happy Money — Best for credit card debt specifically. APR capped at 17.99%. Purpose-built for credit card consolidation, pays creditors directly. Minimum score 640.
Decision Framework
Score 720+: LightStream. Score 660–720: Compare SoFi, Marcus, Discover. Score 580–660: Upgrade. Score 550–580: Avant — run the math first.
Frequently Asked Questions
What credit score do I need for debt consolidation?
Best rates require 720+. Most major lenders approve from 640–660. Upgrade and Avant go as low as 550–580 at higher rates.
Is debt consolidation a good idea?
Yes, if your consolidation rate is lower than your current weighted average rate and you do not run up new credit card balances after consolidating.