If you’re overwhelmed by debt, debt consolidation programs can help you achieve financial stability and support your economic future. Consolidating your debt can help you manage large amounts of debt more easily. This solution combines multiple unsecured debts at a lower interest rate, so you’ll only have a single payment each month.

Whether you have credit card debt, personal loans, medical bills, or payday loans, debt consolidation can save you money in interest and help you pay off your balances. Read on to learn more about how these programs work, their pros and cons, and the best programs currently available.

What Are Debt Consolidation Programs?

Debt consolidation programs are a form of debt relief. They combine multiple high-interest loans and revolving lines of credit into a single monthly payment on one large loan with a fixed term and typically come with a lower fixed interest rate, saving you money and helping you pay off debt faster.

How Do Debt Consolidation Programs Work?

Debt consolidation programs can be in the form of debt consolidation loans offered by traditional financial institutions, credit unions, or online lenders. These are fixed-rate personal loans you can repay over a three to five-year term. The loan application process is most often done online and is usually quick and easy.

You’ll typically need a fair to good credit score (580 to 739) to qualify for consolidation loans at a competitive rate. However, many lenders also cater to borrowers with poor credit histories and lower credit scores.

Nonprofit credit counseling agencies may also help you consolidate debts without the need to take out a new loan. If you have a low credit score, a nonprofit debt management program can be a good way to pay off debts as effectively as possible.

5 Best Debt Consolidation Programs of 2024

If you’re thinking about enrolling in a debt consolidation program, consider our top five recommendations. We reviewed 15 debt consolidation options (from nonprofit, traditional, and online lenders) to select our top choices based on factors like cost, repayment terms, credit score requirements, customer reviews, and availability.

LightStreamInCharge Debt SolutionsAchieveSoFiMoney Management International
APR/Fees7.99%-25.49%$50-$75 setup fee, $30 monthly service fee7.99%-35.99%8.99%-25.81%$33 setup fee, $25 monthly service fee
Loan Amounts$5,000 to $100,000NA$5,000 to $50,000$5,000 to $100,000NA
Term24 to 144 months36 to 60 months24 to 60 months36 to 84 monthsUp to 60 months
Minimum Credit Score660NA620No minimum requirementNA
  • APR: 7.99%-25.49%
  • Loan Amount: $5,000 to $100,000
  • Term: 24 months to 144 months
  • Minimum Credit Score: 660

LightStream is our top choice for the best debt consolidation loans because of its competitive interest rates and longer loan terms. You can borrow up to $100,000 if you have a good credit score and a stable income.

  • Fees: $50-$75 setup fee, $30 monthly service fee
  • Loan Amount: NA
  • Term: 36 to 60 months
  • Minimum Credit Score: N/A

If you want to enroll in a nonprofit debt consolidation program, InCharge Debt Solutions is an effective choice. You can work with a credit counselor to see if consolidating your debts is a good idea. You'll make a single payment to the organization, which will be distributed to your creditors as agreed.

  • APR: 7.99%-35.99%
  • Loan Amount: $5,000 to $50,000
  • Term: 24 months to 60 months
  • Minimum Credit Score: 620

Achieve offers loan amounts up to $50,000 and the option to make direct payments to all your lenders upon approval. With quick funding, you can get funds in your bank account as soon as one business day. You can then pay off the loan over a term as long as 60 months. You may have to pay an origination fee, but rate discounts may help offset the added upfront costs in some cases.

4. SoFi

  • APR: 8.99%-25.81%
  • Loan Amount: $5,000 to $100,000
  • Term: 36 months to 84 months
  • Minimum Credit Score: No minimum requirement

With perks like unemployment protection, discounts, and no fees, SoFi debt consolidation loans are one of the best options available today. You can prequalify to check the rates you may be approved for, and once you submit the application, you’ll usually get the approval on the same day.

  • Fees: $33 setup fee, $25 monthly service fee
  • Loan Amount: N/A
  • Term: Up to 60 months
  • Minimum Credit Score: N/A

Money Management International is a debt counseling agency that offers a few different types of services that can work effectively for many clients. However, the costs for enrolling in their debt management plan (DMP) aren't as affordable as some others and it may take up to five years, or sometimes longer, to complete the program successfully.

Pros and Cons of Debt Consolidation Programs

While a debt consolidation program is an effective way to make your debts more manageable, it’s not the right option for everyone. Consider these pros and cons before you make your decision:


  • Helps you save money if you qualify for a lower rate than the weighted average interest rate on your existing debts
  • Combines multiple debts into one, making repayment easier
  • Makes you debt-free sooner because a fixed loan term assures a known payoff date
  • Lowers your monthly payment, possibly making it lower than all your current payments combined
  • Improves your credit score if you make on-time payments


  • May be difficult to qualify for a consolidation loan if you don’t have a fair to good credit score (620+)
  • Can cost more in interest overall if you choose a longer repayment term
  • May take up to five years (or possibly more) to repay debts

Types of Debt Consolidation Programs

There are two main types of debt consolidation programs: nonprofit programs and those offered by online lenders. Here's more information about both: 

Non-Profit Debt Consolidation Programs

Non-profit debt consolidation programs are available at a low cost (i.e., a one-time enrollment fee and modest monthly fee) and are a good choice if you have bad credit. Since these programs don’t require you to take out a new loan, your credit score won’t matter.

Credit counseling agencies offer these programs, connecting you with a certified credit counselor to guide you through the process. Your counselor will work with your lenders to set up an affordable monthly payment plan. You’ll make a single payment to the agency each month, which it will distribute to your lenders until you pay off your debt.

Online Debt Consolidation Programs

Another form of debt consolidation is borrowing a loan and using the proceeds to pay off your debts. You’re left with a single loan and one monthly payment to simplify repayment.

These loans are offered by online lenders as well as banks and credit unions. Many online lenders will also make direct payments to your creditors. However, you’ll need a strong credit score to qualify for the loan and to get a lower interest rate than what you’re currently paying. There may also be additional costs, such as origination fees, that could drive up the cost of the loan.

Choosing the Best Debt Consolidation Program

Choosing the best debt consolidation program will depend on your financial goals, credit score, the amount of debt you owe, and how much you can afford to pay each month.

“When comparing loans with different lending terms, it's always best to compare them using the annual percentage rate (APR) instead of just the interest rate,” says Brad Reichert, founder and managing director of Reichert Asset Management LLC. “This is because the APR includes all the costs involved with borrowing the funds you need, including any fees or additional costs associated with the loan,” he adds. 

Here are a few things to keep in mind when you’re comparing programs and loan options:

Interest Rates/Fees

Whether you choose to borrow a consolidation loan from an online lender or enroll in a debt consolidation and management program with a nonprofit organization, comparing the costs is important.

Ultimately, the interest rate you qualify for on your debt consolidation loan will depend on your credit utilization rate, credit score, term, and other factors. Pick a loan that offers a lower annual percentage rate (APR) than what you’re currently paying. APRs can range from 6% to 36% for personal loans, so it's best to compare loan offers from multiple lenders.

When comparing nonprofit debt consolidation programs, be sure to compare the enrollment fee and monthly fee.

Added Fees

Some lenders may charge for other items like origination fees, late fees, and prepayment penalties. Origination fees can be 1% to 5% of the loan amount, while late payment fees are typically $25 to $50.

A prepayment penalty can be charged as a fixed fee or a percentage of your loan balance. When comparing lenders, look for a no-fee loan lender.

Repayment Terms

The time it takes to repay your debt can impact how much interest you pay overall. Repayment terms can range from one to seven years. If you want to keep your monthly installment payment low, a longer loan term can help. However, you’ll pay more in interest overall.

With a shorter term, your monthly payment can be higher, but you’ll save money in interest and repay your debt faster.

Are Debt Consolidation Programs Worth It?

Debt consolidation programs may be a good idea if you have high-interest debts. More importantly, they’re a good option if you can qualify for a lower interest rate than what you’re currently paying.

Keep in mind that there are other ways to consolidate your debt, such as through a balance transfer credit card, secured loans, or a home equity loan or line of credit. You’ll need excellent credit for many of these options.

Consolidating your debts may not be a good idea for your financial situation if you can’t get a lower interest rate. It also may not work if you don’t think you’ll be able to afford a new loan’s fixed monthly payments after consolidating your current debts.  If you’ve already missed payments on several credit card bills, you may want to resolve your debts through debt settlement.