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Best Debt Consolidation Loans in Alabama

Debt consolidation loans allow you to combine several debts into a new loan, typically with a lower interest rate. Since you’re paying off multiple debts into one loan that has a fixed monthly payment, you can save money on interest and get out of debt faster. To get approved for a debt consolidation loan in Alabama, your loan eligibility will be evaluated based on various factors like your income and credit score. The average credit score in the state is 706, and the average personal loan debt is $13,892.

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Last Updated: 9/9/2022
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Best Debt Consolidation Loan Lenders in Alabama

MoneyGeek evaluated more than 30 data points to determine the lenders with the best debt consolidation loans in Alabama. We analyzed what each company has to offer, including loan amount ranges, repayment terms, interest rates and fees. Additionally, we looked into the factors that could affect your chances of getting a loan approval, such as minimum credit score and gross income.

Best Overall Debt Consolidation Loan in Alabama: Upgrade


  • Upgrade

    • 5.94% to 35.47%APR Range
    • 560Minimum Credit Score
    • $1,000 to $50,000Loan Amount Range
    • 36 to 60 monthsRepayment Terms
    • Same DayTime to Receive Funds

    on Upgrade Website

Runner-Up for Best Overall Debt Consolidation Loan in Alabama: Truist


  • Truist

    • 8.14% to 18.99%APR Range
    • NoneMinimum Credit Score
    • $3,500 to $50,000Loan Amount Range
    • 6 to 60 monthsRepayment Terms
    • Next DayTime to Receive Funds

    on Truist Website

Best Debt Consolidation Loan for Bad Credit in Alabama: Upstart


  • Upstart

    • 3.22% to 35.99%APR Range
    • 300Minimum Credit Score
    • $1,000 to $50,000Loan Amount Range
    • 36 to 60 monthsRepayment Terms
    • Next DayTime to Receive Funds

    on Upstart Website

Best Debt Consolidation Loan for Good Credit in Alabama: SoFi


  • SoFi

    • 5.74% to 20.28%APR Range
    • 680Minimum Credit Score
    • $5,000 to $100,000Loan Amount Range
    • 12 to 60 monthsRepayment Terms
    • Two DaysTime to Receive Funds

    on SoFi Website

How to Choose the Best Debt Consolidation Loan in Alabama for You

In Alabama, the average personal loan debt is $13,892, with interest averaging 8.85%. One of the most common reasons for taking out a personal loan is debt consolidation. You use your new loan (ideally, one with a lower APR) to pay off your other debts. This way, you can save money on interest and get out of debt faster.

Before pursuing a loan application, you need to consider several factors, such as your credit score and existing debts. MoneyGeek outlined some steps that you can follow when applying for a debt consolidation loan in Alabama.

1

Ask Yourself the Important Questions

Before anything else, you need to ask yourself the following questions to ensure you’re making the right financial decision:

  • How much funding do you need? Make sure you know how much money you need for consolidating debt so you can find the best lender for your situation.
  • What is your credit score? Lenders consider your credit score when reviewing your loan application. Make sure your credit score meets the minimum requirements to avoid getting denied.
  • Can you afford the monthly payment? Consider your current financial situation and determine if you can afford the monthly payment to avoid facing late fees and ruining your credit score.
  • How much debt do you already have? If you’re already paying multiple debts, adding another one may put you in a tight financial spot.
  • Is your debt manageable through other means? Look into other options for debt consolidation, such as balance transfer credit cards, to see if they’re better suited for your needs and situation.
2

Do Your Research

Don’t underestimate the value of doing your own research. MoneyGeek created this guide to provide relevant information on debt consolidation loans in Alabama. However, our recommendations may not cover your unique situation. That’s why it’s best to explore other options to find the best lender for you.

Make sure to look into what each lending company has to offer in terms of loan amount, interest rate and repayment term. You also need to gather information about its minimum requirements on credit score, debt-to-income ratio and gross income. Failing to meet a lender’s criteria can significantly affect your chances of getting a loan approval.

3

Wait

Once you’ve obtained all the necessary information, take a step back before deciding on your best option. This way, you won’t be a victim of confirmation or recency bias. It’s advisable to wait a day or two so you’re more objective in determining the right lender for your needs. Note that regardless of the amount, a debt consolidation loan is a large financial commitment. You need to be sure that you can live up to its accompanying responsibilities before taking out a loan.

4

Read the Fine Print

When conducting your debt consolidation loan research, it’s common to overlook its crucial elements. After you’ve chosen a lender, read the fine print thoroughly. Aside from the fees and rates that are explicitly stated in its terms and conditions, keep an eye out for any hidden fees and loan restrictions. By reviewing the fine print, you can catch any small detail you missed during your research and save you money in the long run.

5

Apply

Once you’ve got your bases covered and you’re confident about your decision, it’s time to submit your loan application. Most lenders require you to provide specific documents and information, such as identification, proof of income and residence verification, during the application process. If online application is allowed, you can choose that option, but there’s no harm in calling your lender or visiting a brick-and-mortar location if it’s possible.

What to Do if You Can’t Get a Debt Consolidation Loan in Alabama

Not getting approved can be discouraging, but it doesn’t mean your journey to getting a debt consolidation loan in Alabama is over. Debt consolidation loan denials happen due to various reasons, including a low credit score or an insufficient income.

MoneyGeek suggests getting in touch with your lender to learn why your loan application was rejected. You can also try asking if anything about your loan details that you can modify. Perhaps shortening your loan term or lowering your loan amount may change their mind.

If your lender’s decision is final, you can always look for a loan somewhere else. However, this move isn’t advisable until you improve the factor that caused your loan application to be denied in the first place.

Also, try to avoid payday loans. They may be tempting if you need quick access to cash, but they come with disadvantages such as higher interest rates and quicker payback periods.

Calculate Your Monthly Payment

Keep in mind that you need to pay back a debt consolidation loan in monthly installments, plus interest. Make sure to calculate your monthly payment first to determine if your budget can cover it, especially if the loan has been pre-approved by your chosen lender.

years
months
%



Principal

+ $114.98

Interest

+ $8.33

Origination Fee Percentage

+
%

Origination Fee Fixed amount

+

Total monthly payment

$123.31

FAQs About Debt Consolidation Loans in Alabama

The best debt consolidation loan in Alabama will be based on your personal needs as well as credit score and income. MoneyGeek answered some frequently asked questions to help you find the best option for you.

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METHODOLOGY

We reviewed more than 30 personal loan lenders using 35+ individual data points across six key categories: loan affordability, accessibility, consumer friendliness, customer service, flexibility and lender transparency.

Within each ranking criteria category, we considered several individual data points that we feel carry the most weight when choosing a personal loan lender. These factors include APR ranges, available loan amount, minimum credit score, minimum income amount, application fees and disbursement time.

Here at MoneyGeek, we value you, the consumer, so we also factor in each lender’s customer support, business ratings and additional features that could make your experience easier and more accessible — like prequalification, payment options and mobile apps.

After careful consideration and calculation, our picks are decided and chosen with your best interest in mind. Our personal loan recommendations and expert tips are meant to help you make the best decision when choosing a lender that meets your needs.

sources

The content on this page is accurate as of the posting/last updated date; however, some of the rates mentioned may have changed. We recommend visiting the lender's website for the most up-to-date information available.

Editorial Disclosure: Opinions, reviews, analyses and recommendations are the author’s alone and have not been reviewed, endorsed or approved by any bank, lender or other entity.