Tuesday, June 28th
2022 Debt Consolidation Company Reviews
Payoff
- Debt consolidation in the form of a personal loan
- Competitive interest rates
- Loan amounts from $5,000 to $40,000
- Origination fees of 0-5%
- "A+" rated and accredited by the BBB
Payoff is part of the Happy Money brand, and the service works with eight lending partners who originate loans. You would use the loan to pay off all of your debts as a DIY consolidation strategy; Payoff doesn't offer credit counseling or any other services as part of their program. While you can use your loan in any way you choose, Payoff says that their loans are "specifically designed to help you eliminate high-interest credit card debt" , and that doing so may increase your credit score by 40 points or more.
Minimum credit score and other requirements
To qualify for a debt consolidation loan through Payoff, you'll need to meet some basic criteria. Those include a FICO score of 640+ and no current delinquencies. Your debt-to-income ratio, age of credit history, and your credit utilization will also be taken into account, but Payoff doesn't give any specifics on what they're looking for. You will also need to provide your SSN and have a valid checking account.
Not a "get money fast" service
The initial online application is fast. You can check your rate without impacting your credit score and see what loan offers might be made to you. Because you're being handed off to one of Payoff's lenders, the rest of the process is on their time. Expect a lengthy process of income verification, submission of documents, and other paperwork before your loan is funded. (In other words, this is not a "need cash now" option.)
Loan amounts and rates are just average
You can borrow anywhere from $5,000 to $40,000 from Payoff's partner lenders, depending on your creditworthiness and ability to repay the loan. If you wind up being approved for a loan through Payoff, you can expect interest rates competitive with other lenders. Keep in mind, you'll probably be paying less than the rate on your credit cards.
BBB gives them an A+
Payoff gets extremely mixed reviews. On the positive side, the company earned the highest rating and accreditation from the Better Business Bureau. We found clients who said that their experience with Payoff was smooth, the interest rate was better than they were quoted by other lenders, and they were able to borrow more than they expected.
Too many negative client reviews
However, we found more than a few reviews that slammed Payoff for giving preapprovals with one interest rate and then offering a loan with a much higher APR. Frequent complaints described delayed paperwork, missed recording of payments, and overall poor communication. The most common comment was that applicants jumped through endless hoops to apply, only to be denied at the very end for a debt-to-income ratio that could have been easily verified early on in the process.
Better debt consolidation loans available elsewhere
Payoff falls well below other services that offer debt consolidation in the form of a personal loan. With so many complaints about delayed paperwork and seemingly bait-and-switch loan offers, we suggest you look at one of Payoff's rivals before committing to using them for your debt consolidation needs.
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The 12 Best Debt Consolidation Companies
Who is the Best Debt Consolidation Company?
Maybe you've gotten overwhelmed by credit card payments and overdue bills, and now you're wondering if there's any light at the end of the tunnel. Or, perhaps you're a financially-savvy consumer who wants to take advantage of lower interest rates, in order to pay off your mounting credit cards bills. Debt consolidation can be a smart strategy either way.
What, exactly, is debt consolidation? It's important to understand that companies offering it may mean different things. For some, debt consolidation is offered as a personal loan: you borrow funds that you use to pay off all of your outstanding debts. Your interest rate should be much lower than your credit cards, and now you've got a simplified, single payment to make each month. This can be a great way to boost your credit score by reducing the likelihood of making late payments (or none at all) and get on your feet again financially. On the other hand, you're in charge of using your loan money responsibly - and not to buy things you don't need!
Debt Consolidation Company FAQ
Continued from above...
Other providers of debt consolidation take a more hands-on approach, giving you credit counseling and even going to bat for you with your creditors. The services they provide may include negotiating a lower debt amount or getting your debt forgiven altogether! You might pay a monthly fee for this kind of debt consolidation, or it might be a flat fee based on how much money they saved you overall.
Either route you choose, there are a lot of options out there. How can you decide which one is right for you? Keep these points in mind as you weigh out the possibilities:
- Approach. Is the debt consolidation accomplished by a personal loan that you have to pass along to your creditors, or is it a more involved strategy? Which one is more likely to leave you better off financially?
- Education. What does the company offer to teach you how to make good financial decisions? Does the service make sure you understand what you're getting into with their approach?
- Eligibility Requirements. Do you qualify for debt consolidation? Some programs require you to have $5,000 or more in unsecured debts. For consolidation via personal loans, you'll pay more in interest if you don't have a decent credit history already, or you may not be approved for a loan.
- Fees. How much will you pay for your debt consolidation? If it's a loan, what's the interest rate and are there any origination fees? If it's a debt settlement strategy, what will your fees be and when will you have to pay them?
- Reputation. What do clients say about the debt consolidation company? Did they get help that was appropriate for their situation from knowledgeable, friendly representatives? Has the Better Business Bureau rated the service? Do people report a significant improvement in their finances after (or preferably while) using the debt consolidation program?
TopConsumerReviews.com has evaluated and ranked the best debt consolidation options available today. We're confident that this information will help you choose a strategy to pay down your debts and get your finances in order!
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