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While Texas residents earn slightly less than the rest of the country, they also have a smaller amount of total debt.
However, although Texas residents had marginally less debt than the national average, it could still be a lot to handle. One option to more easily manage your debt is to combine it with a debt consolidation loan.
Here’s what to know about debt consolidation in Texas:
- Where to get a debt consolidation loan in Texas
- How to apply for a debt consolidation loan
- Will a debt consolidation loan affect your credit score?
- Alternatives to debt consolidation loans
Where to get a debt consolidation loan in Texas
If you’re looking for debt consolidation loans in Texas, here are a few lender options to choose from:
Online lenders can be a convenient choice for debt consolidation loans since you can easily shop around and compare loan options with just a few clicks of your mouse.
The time to fund for online loans is typically five business days or less — though depending on the lender, you might have your loan funded as soon as the same or next business day if you’re approved.
Here are Credible’s partner lenders that offer debt consolidation loans in Texas:
|Lender||Fixed rates||Loan amounts||Min. credit score||Loan terms (years)|
|7.99% - 29.99% APR||$7,500 to $50,000||Not disclosed by lender||2, 3, 4, 5|
|9.95% - 35.99% APR||$2,000 to $35,000**||550||2, 3, 4, 5*|
|11.79% - 20.84% APR||$10,000 to $50,000||730||3, 4, 5, 6|
|8.99% - 35.99% APR||$2,000 to $50,000||600||2, 3, 4, 5|
|7.99% - 24.99% APR||$2,500 to $40,000||660||3, 4, 5, 6, 7|
|11.72% - 24.67% APR||$5,000 to $40,000||640||2, 3, 4, 5|
|9.57% - 35.99% APR||$1,000 to $40,000||660||3, 5|
|7.99% - 35.99% APR||$2,000 to $36,500||660||2, 3, 4, 5, 6|
|7.49% - 25.49% APR with autopay||$5,000 to $100,000||700||2, 3, 4, 5, 6, 7
(up to 12 years for home improvement loans)
|18.0% - 35.99% APR||$1,500 to $20,000||None||2, 3, 4, 5|
|8.49% - 17.99% APR||$600 to $50,000 |
(depending on loan term)
|700||1, 2, 3, 4, 5|
|8.99% - 25.81% APR10||$5,000 to $100,000||Does not disclose||2, 3, 4, 5, 6, 7|
|11.69% - 35.99% APR7||$1,000 to $50,000||560||3, 5, or 7 years 8|
|8.49% - 35.99% APR||$1,000 to $50,000||600||2, 3, 5, 6|
|5.2% - 35.99% APR4||$1,000 to $50,0005||620||3 or 5 years4|
If you already have an account at a bank, it could be worth checking to see if they also offer debt consolidation loans since you might qualify for a rate discount as an existing customer.
Here are a few regional banks in Texas that offer debt consolidation loans. Note that these lenders aren’t Credible partners.
Learn More: Credit Card Consolidation Loans
Because credit unions are nonprofit organizations, they sometimes offer lower rates than banks. They also tend to be more community-focused.
Here are some of the major credit unions in Texas that offer debt consolidation loans. Keep in mind that these lenders aren’t Credible partners.
- NavyArmy Community Credit Union
- Randolph-Brooks Federal Credit Union
- Security Service Federal Credit Union
No matter which type of lender you choose for your debt consolidation loan, it’s important to consider how much the loan will cost you over time. You can estimate how much you’ll pay for a loan using our personal loan calculator below.
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With a $ loan, you will pay $ monthly and a total of $ in interest over the life of your loan. You will pay a total of $ over the life of the loan.
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How to apply for a debt consolidation loan
If you’re ready to apply for a debt consolidation loan, follow these four steps:
- Check your credit history. Lenders will review your credit to determine your creditworthiness, which is why it’s important to make sure your credit history has no errors that could be impacting your score. You can use a site like AnnualCreditReport.com to check your credit reports. If you find any errors, dispute them with the appropriate credit bureaus to potentially see a boost to your credit score.
- Compare lenders and choose a loan option. Be sure to compare as many lenders as possible to find the right loan for you. Consider not only personal loan rates but also repayment terms and any fees charged by the lender. After you’ve done your research, you can pick the loan option that best suits your needs.
- Fill out the application. Once you’ve chosen a lender, you’ll need to complete a full application and submit any required documentation, such as tax returns or pay stubs.
- Get your funds. If you’re approved, the lender will have you sign for the loan so they can release the funds to you. The time to fund for a debt consolidation loan is typically one week or less.
Learn More: How Do Personal Loans Work?
Will a debt consolidation loan affect your credit score?
While a debt consolidation loan could temporarily hurt your credit score, the positive impact will usually outweigh this over time.
Here are a few ways that a debt consolidation loan could impact your credit score:
- Could lower your credit utilization ratio: Your credit utilization — which is the amount of credit you’ve used compared to the total amount of credit you have available — makes up 30% of your FICO score. Consolidating your debt might help reduce this ratio and improve your credit.
- Might help payment history: Your payment history makes up the biggest part of your credit score. If you want to build your credit, consistently making on-time payments on your debt consolidation loan could help.
- Could add to your credit mix: Lenders like to see that you can handle multiple types of debt, so adding a consolidation loan to your credit mix might have a positive impact.
- Might temporarily lower your score: Because the lender will perform a hard credit pull when you apply for a debt consolidation loan, you could see your score drop by a few points. However, this effect is usually short-lived, and you’ll likely see your score bounce back within a few months.
- Could damage your credit if you miss payments: If you can’t keep up with your payments, you could see your score drop significantly.
Alternatives to debt consolidation loans:
If a debt consolidation loan doesn’t seem right for you, here are a few other options to consider:
- Balance transfer credit card: If you want to pay off credit card debt, a balance transfer card could be a good choice. Some cards offer a 0% APR introductory offer, during which you won’t have to worry about interest charges on the card. If you can repay your balance before this period ends, you could avoid paying any interest. However, keep in mind that if you can’t pay off the card in time, you could be stuck with some hefty interest charges.
- Home equity loan: Homeowners might be able to access the equity in their homes with a home equity loan. If you’re considering a home equity loan vs. personal loan, note that you might get a lower interest rate on a home equity loan since it’s secured by your house. However, keep in mind that if you can’t make your payments, your home could be at risk.
- Debt management plan: These plans are offered by nonprofit credit counseling agencies — such as the National Foundation for Credit Counseling — that help you get your payments back on track with your creditors. You’ll typically make one monthly payment over three to five years, which the agency pays out to your creditors.
- Debt settlement: This service is offered by third-party companies and could help you reduce your debt, typically by negotiating a smaller lump-sum payment with your creditors. Keep in mind that debt settlement companies sometimes ask you to simply stop paying your debts as a way to gain leverage in the negotiations, which could hurt your credit. There’s also no guarantee it will work — so if you decide to go this route, be sure to consult with an attorney or the appropriate financial advisors first. Your local credit unions might also have advisors available to help you make an informed decision.
- Bankruptcy: If you can’t pay your bills, declaring bankruptcy might be an option. Note that bankruptcy can come with costly fees and could severely damage your credit for up to 10 years, so it should be a last resort after exploring all of your other alternatives.
If you decide to take out a personal loan to consolidate your debt, remember to consider as many lenders as you can to find the right loan for you. Credible makes this easy — you can compare your prequalified rates from multiple lenders that work with Texas residents in two minutes.
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About Rates and Terms: Rates for personal loans provided by lenders on the Credible platform range between 5.20%-35.99% APR with terms from 12 to 144 months. Rates presented include lender discounts for enrolling in autopay and loyalty programs, where applicable. Actual rates may be different from the rates advertised and/or shown and will be based on the lender’s eligibility criteria, which include factors such as credit score, loan amount, loan term, credit usage and history, and vary based on loan purpose. The lowest rates available typically require excellent credit, and for some lenders, may be reserved for specific loan purposes and/or shorter loan terms. The origination fee charged by the lenders on our platform ranges from 0% to 12%. Each lender has their own qualification criteria with respect to their autopay and loyalty discounts (e.g., some lenders require the borrower to elect autopay prior to loan funding in order to qualify for the autopay discount). All rates are determined by the lender and must be agreed upon between the borrower and the borrower’s chosen lender. For a loan of $10,000 with a three year repayment period, an interest rate of 7.99%, a $350 origination fee and an APR of 11.51%, the borrower will receive $9,650 at the time of loan funding and will make 36 monthly payments of $313.32. Assuming all on-time payments, and full performance of all terms and conditions of the loan contract and any discount programs enrolled in included in the APR/interest rate throughout the life of the loan, the borrower will pay a total of $11,279.43. As of October 9, 2023, none of the personal loan lenders on our platform require a down payment nor do they charge any prepayment penalties.