Payoff is a personal loan company specializing in consolidating high-interest credit card debt. In this review, we’ll explain how a Payoff personal loan works and whether it is right for you.
A lot of people love credit cards because they can earn rewards. Plus, you can buy now and pay later — or at least that’s what some people believe. But credit card debt is a major issue for many people. In 2019, the average credit card balance for Americans was a whopping $6,194.
If you’re one of the many Americans struggling with credit card debt, have you ever thought of taking out a personal loan to help pay it off faster? Personal loans are an excellent way to dump high-interest credit card debt and get your finances back on course.
Payoff is a leader in the personal loan industry, despite having only been in business since 2009. Most companies allow you to use a personal loan for a variety of reasons, however Payoff specializes in personal loans for paying off credit card debt. To find out if this lender is a good choice for you, keep reading.
Personal Loans Starting at 5.99% APR – Payoff offers personal loans specifically for paying off high-interest debt! Get started here.
What Is Payoff?
Payoff is a financial services company that works with lending partners to provide personal loans specifically for paying off credit cards. It offers a simple application process, including a chance to check rates in advance without hurting your credit score.
Loans are available from $5,000 to $35,000, and come with customizable terms to fit your needs. Payoff customers can consolidate all of their credit card debt into one monthly bill at a fixed rate.
Not only does Payoff help people destroy credit card debt, but it helps the average customer boost their FICO credit score by 40 points in the process. Payoff customers get monthly access to their FICO credit score, too, so you can track your progress toward a healthier financial future.
Payoff is upfront about its origination fee, which is between 0% and 5%. An origination fee is an upfront fee charged by lenders when processing loan applications. That’s the only fee that Payoff customers see, though. Common fees that not charged by Payoff include:
- Application fees
- Early payment fees
- Extra payment fees
- Late fees
- Annual fees
- Returned check fees
- Check processing fees
Important Information: At a Glance
Payoff only has one loan option, but that won’t limit most potential customers. Here’s what you need to know about Payoff personal loans.
Minimum loan amount: $5,000
Maximum loan amount: $35,000
Interest rates: Fixed rates starting at 5.99% APR
Loan terms: Between two and five years
Prepayment penalties: None
Origination fees: 0% to 5%
Availability: Loans are available in almost all states except Massachusetts, Mississippi, Nebraska, Nevada, and West Virginia.
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Payoff Personal Loan Requirements
Payoff considers several factors to determine eligibility for a personal loan. First, the company requires a minimum FICO credit score of 640, which is considered fair credit. If you have any current credit delinquencies, you’ll need to resolve those before applying for a loan through Payoff. Payoff also looks at other criteria, including:
- Debt-to-income ratio
- The length of your credit history
- Credit utilization
- Open and satisfactory trades
In order to successfully apply for a loan, you must be at least 18 years old, have a Social Security number, and own a checking account.
How to Apply for a Personal Loan Through Payoff
Applying for a personal loan through Payoff is a simple process that takes as little as three minutes to complete. First, take the time before applying to check your rate. This involves providing some personal information and running a soft credit inquiry, which has no adverse effect on your credit score.
The next step, if you receive an offer, is to choose your terms. You’ll have a chance to review your terms, verify your personal information, and then sign your loan documents.
Applicants might be asked to provide some personal information for verification purposes, such as:
- A bank statement or credentials to link to your bank account
- A driver’s license, passport, or state-issued ID
- Your two most recent pay stubs (or most recent tax return if self-employed)
Payoff does perform a hard credit inquiry before finalizing any loans. This is where they take a deeper dive into your credit to look for any new personal loans, bankruptcies, or delinquencies. Hard credit inquiries can negatively affect your credit score temporarily.
If approved for a Payoff personal loan, funds are electronically deposited directly into your linked bank account. Most of Payoff’s personal loans are funded within two to five business days of approval.
Related: Best Personal Loan Rates This Month
Tips on Choosing a Personal Loan
Take time to compare several lenders before choosing one for your personal loan. Here are some other factors to consider when choosing a personal loan.
- Interest Rates: Loan rates are the first thing that most people look at, and for good reason. Lower rates mean less interest paid over the life of a loan, saving you money. If you don’t like the rate options you receive, work to improve your credit score before getting a loan.
- Fees: Some lenders charge fees for almost everything. Most lenders charge origination fees, but make sure you look for any other hidden fees. These could include processing fees, late payment fees, and prepayment penalties, among others.
- Terms: Your loan terms affect your interest rates and how much you pay each month. They also determine how long you’ll be paying back your personal loan. Compare available loan terms to see which length is right for you.
- Your Credit: Although most lenders allow you to check rates before applying, you should have a good handle on your credit status first. You can do that by getting a free copy of your credit report at AnnualCreditReport.com.
Payoff Review: Is It Right For You?
If you’re having a hard time paying off credit card debt, a Payoff personal loan might be what you need to escape the debt cycle. It’s a great way to consolidate several cards into one monthly payment. With the right rate, you’ll avoid paying the high interest rates that accompany most credit cards and pay off your debt more quickly and save money on interest. The lack of extra fees and the customizable loan terms are positive notes, as well.
That said, other lenders might offer better interest rates and terms than Payoff. That’s why it’s important to compare rates before choosing a lender. You can compare multiple lenders in one spot with Credible personal loans, but also check with your existing banking relationships prior to making a commitment. It is also important to ensure that you meet credit requirements before applying.
If your credit just doesn’t cut it, either wait until your credit improves or consider bad-credit loans instead. If your credit card debt isn’t that high, getting a good balance transfer credit card is another available option — provided you’ll be able to keep from adding more debt to your balance.
Low Rates and Fees – Payoff offers personal loan rates starting at 5.99% APR and low fees you won’t find with other lenders. Get your rate here!