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9 Best Debt Consolidation Loans for Fair Credit of June 2024

If you can’t qualify for a debt consolidation loan on your own, applying with a cosigner or building your credit can help.

Author
By Dori Zinn

Written by

Dori Zinn

Writer

Dori Zinn is a personal finance journalist with work featured in Huffington Post, Quartz, Wirecutter, Bankrate, and others. She loves helping people learn to be better with money.

Edited by Meredith Mangan

Written by

Meredith Mangan

Senior Editor

Meredith Mangan is a Senior Editor for Personal Finance, specializing in personal loans. Since 2011, she’s helped steer content creation in the areas of mortgages and loans, insurance, credit cards, and investing for major finance verticals, including Investopedia, Money Crashers, Credible, and The Balance Money.

Updated May 31, 2024

Editorial disclosure: Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as “Credible.”

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A debt consolidation loan lets you combine multiple debts into one, leaving you with just one loan and one payment to manage — and ideally, a lower interest rate. Average rates on debt consolidation loans for fair credit were just under 28%, according to Credible data from October, while average rates for good credit borrowers were around 20%. Considering that credit card APRs can be over 30%, you could still save money by consolidating debt with fair credit, especially if you have high income, a cosigner, or collateral — all of which could get you a lower rate.

Best debt consolidation loans for fair credit

If you have fair credit — usually considered to be a FICO score between 580 and 669 — you can still qualify for a debt consolidation loan from certain lenders. Here are Credible’s partner lenders that offer fair credit personal loans for debt consolidation:

Advertiser Disclosure
3.93.9

Credible rating

Fixed (APR)

7.80% - 35.99%

Loan Amounts

$1000 to $50000

Min. Credit Score

620

Check Rates

on Credible’s website

View Details

4.44.4

Credible rating

Fixed (APR)

-

Loan Amounts

$2500 to $40000

Min. Credit Score

660

Check Rates

on Credible’s website

View Details

4.54.5

Credible rating

Fixed (APR)

8.49% - 35.99%

Loan Amounts

$1000 to $50000

Min. Credit Score

600

Check Rates

on Credible’s website

View Details

44

Credible rating

Fixed (APR)

8.98% - 35.99%

Loan Amounts

$1000 to $40000

Min. Credit Score

660

Check Rates

on Credible’s website

View Details

44

Credible rating

Fixed (APR)

8.99% - 35.99%

Loan Amounts

$2000 to $50000

Min. Credit Score

600

Check Rates

on Credible’s website

View Details

3.93.9

Credible rating

Fixed (APR)

9.95% - 35.99%

Loan Amounts

$2000 to $35000

Min. Credit Score

550

Check Rates

on Credible’s website

View Details

4.34.3

Credible rating

Fixed (APR)

11.69% - 35.99%

Loan Amounts

$1000 to $50000

Min. Credit Score

560

Check Rates

on Credible’s website

View Details

3.93.9

Credible rating

Fixed (APR)

11.72% - 17.99%

Loan Amounts

$3000 to $40000

Min. Credit Score

640

Check Rates

on Credible’s website

View Details

3.93.9

Credible rating

Fixed (APR)

18.00% - 35.99%

Loan Amounts

$1500 to $20000

Min. Credit Score

540

Check Rates

on Credible’s website

View Details

All APRs reflect autopay and loyalty discounts where available | LightStream disclosure | SoFi Disclosures | Read more about Rates and Terms

Avant: Best for all credit types

All credit types

Avant

3.9

Credible Rating

Check Rates

on Credible’s website

Est. APR

9.95 - 35.99%

Loan Amount

$2000 to $35000

Min. Credit Score

550

Pros and cons

More details

Best Egg: Best for high close rates if pre-approved

High Close Rates if Pre-approved

Best Egg

4

Credible Rating

Check Rates

on Credible’s website

Est. APR

8.99 - 35.99%

Loan Amount

$2000 to $50000

Min. Credit Score

600

Pros and cons

More details

Discover: Best for no origination fees (and low rates)

No origination fees (and low rates)

Discover Personal Loans

4.4

Credible Rating

Check Rates

on Credible’s website

Est. APR

-

Loan Amount

$2500 to $40000

Min. Credit Score

660

Pros and cons

More details

Happy Money: Best for consolidating credit card debt

Consolidating credit card debt

Happy Money

3.9

Credible Rating

Check Rates

on Credible’s website

Est. APR

11.72 - 17.99%

Loan Amount

$3000 to $40000

Min. Credit Score

640

Pros and cons

More details

LendingClub: Best online experience

Online experience

LendingClub

4

Credible Rating

Check Rates

on Credible’s website

Est. APR

8.98 - 35.99%

Loan Amount

$1000 to $40000

Min. Credit Score

660

Pros and cons

More details

OneMain Financial: Best bad credit personal loans

Bad credit personal loans

OneMain Financial

3.9

Credible Rating

Check Rates

on Credible’s website

Est. APR

18.00 - 35.99%

Loan Amount

$1500 to $20000

Min. Credit Score

540

Pros and cons

More details

Universal Credit: Best debt consolidation loans for bad credit

Debt consolidation loans for bad credit

Universal Credit

4.3

Credible Rating

Check Rates

on Credible’s website

Est. APR

11.69 - 35.99%

Loan Amount

$1000 to $50000

Min. Credit Score

560

Pros and cons

More details

Upgrade: Best for fair credit

Fair credit

Upgrade

4.5

Credible Rating

Check Rates

on Credible’s website

Est. APR

8.49 - 35.99%

Loan Amount

$1000 to $50000

Min. Credit Score

600

Pros and cons

More details

Upstart: Best fast personal loans for all credit types

Fast personal loans for all credit types

Upstart

3.9

Credible Rating

Check Rates

on Credible’s website

Est. APR

7.80 - 35.99%

Loan Amount

$1000 to $50000

Min. Credit Score

620

Pros and cons

More details

How to get a debt consolidation loan with fair credit

If you’re ready to get a debt consolidation loan with fair credit, follow these four steps:

  1. Check your credit. When you apply for a personal loan for debt consolidation, the lender will review your credit to determine your creditworthiness. It’s a good idea to check your credit before you apply to see where you stand. You can use a site like AnnualCreditReport.com to review your credit reports for free. If you find any errors, dispute them with the appropriate credit bureaus to potentially boost your credit score.
  2. Compare lenders and choose a loan option. Be sure to compare as many lenders as you can to find the right loan for you. Consider not only interest rates but also credit requirements, repayment terms, and any fees charged by the lender. Afterward, pick the loan option that best suits your needs.
  3. Complete the application. Once you’ve chosen a lender, you’ll need to fill out a full application and submit any required documentation, such as tax returns or pay stubs.
  4. Get your funds. If you’re approved, the lender will have you sign for the loan so you can get your money. The time to fund for personal loans is usually about one week — though some lenders will fund loans as soon as the same or next business day after approval. You might also have the option to have the funds sent directly to your creditors, depending on the lender.

Do debt consolidation loans hurt your credit score?

Anytime you apply for a new loan, the lender will perform a hard credit check to determine your creditworthiness. This could cause a slight dip in your credit score — though this is usually only temporary, and your score will likely bounce back within a few months.

Learn More: How Debt Consolidation Helps Your Credit

tip Icon

Tip

A debt consolidation loan could help your credit if you make all of your payments on time. In general, this positive effect on your credit score could outweigh any initial negative impact on your credit score.

If you decide to take out a debt consolidation loan, be sure to also consider how much that loan will cost you over time. This way, you can prepare for any added expenses. You can estimate how much you’ll pay for a loan using our personal loan calculator.

What is a fair credit score?

In general, a fair credit score is considered to be a FICO score between 580 and 669. Here are the credit score ranges you’ll typically come across:

Credit score ranges
Credit rating
Below 580
Poor
580 to 669
Fair
670 to 739
Good
740 to 799
Very good
800 and up
Excellent

Personal loan interest rates by credit score

Your credit score plays a large role in deciding what interest rate you qualify for, along with your repayment term and the lender itself. In general, the better your credit, the lower the interest rate you’ll likely get — which means you’ll pay less in interest over the life of your loan.

Here are the average personal loan interest rates by credit score offered to borrowers who used Credible to take out a three-year personal loan in November 2023:

Credit Score Ranges
Average APR
780 or above
13.21%
720 to 779
16.59%
680 to 719
21.71%
640 to 679
26.92%
600 to 639
29.99%
Less than 600
31.64%

Learn More: What Credit Score Do You Need for a Personal Loan?

How much of a loan can you get with a 600 credit score?

Personal loans typically range from $600 to $100,000, depending on the lender. However, if you’re looking to get a personal loan with a 600 credit score (or lower), keep in mind that your credit score, repayment term, and other factors will likely affect how much you’ll actually be able to borrow.

If you’re struggling to get approved for a personal loan, applying with a cosigner could improve your chances. While most lenders don’t allow cosigners on personal loans, some do.

Having a cosigner might also help you qualify for either a lower interest rate or a higher loan amount — though keep in mind that if you can’t make your payments, your cosigner will be on the hook for repaying the loan.

Before taking out a personal loan for debt consolidation, remember to consider as many lenders as possible to find a loan that works for you. Credible makes this easy — you can compare your prequalified rates from multiple lenders in two minutes.

Compare Rates Now

How to boost your credit score

While you might qualify for a debt consolidation loan with fair credit, these loans often come with higher interest rates compared to good credit loans. If you’d like to get approved for better rates in the future, it could be a good idea to spend some time building your credit.

Here are a few ways to potentially boost your credit score:

  • Pay all of your bills on time: Payment history makes up the biggest part of your credit score — 35%. Making on-time payments could help you build a positive payment history while improving your credit score.
  • Pay down credit card balances. Your credit utilization — or the amount of debt you owe compared to your credit limits — makes up 30% of your credit score. Paying down credit cards and other debts could help reduce your credit utilization and boost your score.
  • Become an authorized user. A simple way to help build credit — especially if you don’t have a credit history yet — is to become an authorized user on a credit card account. This can help build your credit without you even having to use the card.

Raising your credit score could help you save money in the long run on future loans, as you’ll have a better chance of qualifying for lower rates.

Say you had a 600 credit score and took out a $20,000 personal loan with a three-year term. If you qualified for the average 29.26%, you’d end up paying $10,274 in interest over the life of the loan.

But if you were able to boost your score to 680 and got approved for the average 17.96% APR, you’d pay only $6,015 in interest.

Read More:

Meet the expert:
Dori Zinn

Dori Zinn is a personal finance journalist with work featured in Huffington Post, Quartz, Wirecutter, Bankrate, and others. She loves helping people learn to be better with money.