Frequently asked questions

It’s combining several debts — usually high-interest credit cards — into one new loan with a single fixed monthly payment. The goal is a simpler payment and, ideally, less money lost to interest.

Usually not. Getting an initial rate estimate (pre-qualification) is typically a soft credit check, which doesn’t affect your score. A hard inquiry only happens later if you formally apply — and it lowers your score by only a few points, recovering within about a year.

It varies by lender. Top-tier lenders advertise the lowest rates but often decline applicants below about 660. Others work with good-but-not-perfect credit (around 640) or lower, usually at higher rates. Approval also depends on income and other factors.

Personal loans for consolidation typically range from about 7% to 36% APR depending on your credit, with terms commonly between 2 and 5 years. Some lenders charge an origination fee; others don’t — so compare the total cost, not just the rate.

It depends on your numbers. If the loan’s rate and total cost are lower than what you’re paying on your cards, you can save on interest and get a fixed payoff date. If a longer term lowers your payment but raises total interest, the math changes. Use the calculators to compare your own situation.

A consolidation loan pays your debts in full and you repay the loan — your accounts stay in good standing. Debt settlement negotiates to pay less than you owe, usually requires you to stop paying (which damages credit), and forgiven debt can count as taxable income (creditors report cancellations of $600 or more to the IRS on Form 1099-C). They’re very different paths — see the Learn page for the full breakdown.

It’s an option some lenders offer where the loan money is sent straight to your credit card companies instead of to you. Your cards are paid in full and you repay the lender with one fixed payment. Some lenders lower the rate for it; not all lenders offer it. Keep paying your cards until the payoff posts.

No. Direct pay is part of a loan that pays your creditors in full, so your accounts stay in good standing. A debt relief (settlement) program is not a loan — it usually has you stop paying your creditors while it tries to negotiate a lower amount, which can seriously damage your credit. If anyone tells you to stop paying your cards, you’re being offered settlement, not a loan.

Paying on time and how much of your card limits you’re using. In FICO’s model, payment history is about 35% and amounts owed about 30%, followed by length of history (15%), new credit (10%), and credit mix (10%). Checking your own credit doesn’t hurt your score, and you can get free reports weekly at AnnualCreditReport.com.

It can. FICO’s rule that counts multiple inquiries as one applies to mortgage, auto, and student loans — not personal loans. The safer approach is to compare rates with soft-pull pre-qualifications (no score impact), then formally apply only with the lender you choose.

No. This is free, independent educational content. We’re not a lender, we don’t sell, broker, or refer loans, we earn no commissions, and we don’t run ads on you. There’s nothing to sign up for.

No. The calculators run entirely in your browser — anything you enter stays on your device and is never sent to us or anyone else. We don’t collect personal information at all.