Citizens Bank Debt Consolidation Loan Review: Is It Worth It?

Debt consolidation is a solution that many people use when they are having problems repaying several obligations. In order to consolidate your debt into a single monthly payment, you must take out a new loan to pay off numerous other loans or debts that you already have. One lender that provides loans for debt consolidation is Citizens Bank. In this evaluation, we’ll examine how competitively priced Citizens Bank debt consolidation loan program is in relation to those offered by rival lenders.

Debt Consolidation Loan: What is It?

Taking out a new loan to pay off several obligations is known as debt consolidation, and it is a debt management approach. You may be able to lower your interest rates and costs, simplify your monthly payments, and eliminate debt more quickly by combining your loans. You can consolidate your debts using certain types of loans, including debt consolidation loans.

Citizens Bank Debt Consolidation Loan: What Is It?

The well-known bank Citizens Bank provides a variety of financial services and products. They provide loans for debt consolidation to qualified consumers who seek to streamline their debt payments. A Citizens Bank debt consolidation loan has the following important characteristics:

Amounts of Loan

A Citizens Bank debt consolidation loan allows you to borrow up to $50,000, which is more than some other lenders allow.

Loan Terms

3 to 7 year loan terms are available from Citizens Bank. Your monthly payment will be cheaper the longer the loan duration, but your total interest payments will be higher.

The Interest Rates

Because Citizens Bank offers fixed interest rates, your interest rate won’t fluctuate during the course of your loan. Their interest rates begin at 6.79% APR, which is a competitive rate when compared to those of other lenders.

Charges

No application, origination, or prepayment fees are assessed by Citizens Bank for their debt consolidation loans.

Credit Score Required

Citizens Bank has a fairly high minimum credit score requirement of 680 in order to be qualified for a debt consolidation loan, compared to some other lenders.

Process of Application

A Citizens Bank debt consolidation loan application can be submitted online, over the phone, or in person at a branch. You can receive a decision quickly after submitting an application because it is simple.

How Competitive Is Citizens Debt Consolidation Loan?

How does the debt consolidation loan program offered by Citizens Bank stack up against those offered by other lenders in the market, despite the fact that it has certain appealing qualities like sizable loan amounts and low interest rates? To compare some other well-known debt consolidation loan options to Citizens Bank, let’s take a closer look at a few of them.

LendingClub’s Debt Consolidation Loan

Loans for debt consolidation are available to qualified consumers through the peer-to-peer lending platform LendingClub. A LendingClub debt consolidation loan has the following essential characteristics:

Loan Amounts: A debt consolidation loan from LendingClub has a maximum borrowing limit of $40,000, which is a little less than that of Citizens Bank.

Loan Terms: LendingClub provides loans with terms between three and five years, as opposed to Citizens Bank.

Interest rates: LendingClub offers fixed interest rates that begin at 6.95% APR, which is marginally less than Citizens Bank.

Fees: LendingClub imposes origination fees that are greater than Citizens Bank, ranging from 1% to 6% of the loan amount.

Credit Score: LendingClub has a minimum credit score requirement of 600, which is lower than Citizens Bank’s requirement.

Application Process: Applying for a LendingClub debt consolidation loan online is quick and easy, and you’ll hear back in a matter of minutes.

Prosper’s Debt Consolidation Loan

Another platform for peer-to-peer lending is Prosper, which provides debt consolidation loans to qualified applicants. A Prosper debt consolidation loan has the following essential characteristics:

Loan Amounts: A Prosper debt consolidation loan offers a slightly lower maximum loan amount ($40,000) than one from Citizens Bank.

Loan Term: Prosper offers shorter loan periods than Citizens Bank, ranging from 3 to 5 years.

Interest rates: Prosper has fixed interest rates starting at 6.95% APR, which is a little less than Citizens Bank.

Fees: Compared to Citizens Bank, Prosper charges origination fees that range from 2.41% to 5% of the loan amount.

Credit Score: At 640, Prosper’s minimal credit score is lower than Citizens Bank’s for debt consolidation loans.

Application Process: Applying for a Prosper debt consolidation loan online is quick and easy, and you will receive a response quickly.

Wells Fargo’s Debt Consolidation Loan

One well-known bank that provides debt consolidation loans to qualified borrowers is Wells Fargo. A Wells Fargo debt consolidation loan has the following important characteristics:

Loan Amounts: Wells Fargo debt consolidation loans have a $100,000 maximum loan amount, which is more than Citizens Bank.

Loan Term: Wells Fargo offers loan periods that are longer than Citizens Bank’s, ranging from 12 to 84 months.

Interest rates: In contrast to Citizens Bank, Wells Fargo offers fixed interest rates with a starting APR of 5.74%.

Fees: Wells Fargo does not charge application or prepayment fees, however they do impose an origination fee that is greater than Citizens Bank at 0.5% to 5% of the loan amount.

Credit Score: Wells Fargo has a lower credit score requirement than Citizens Bank, requiring a minimum score of 600 to be eligible for a debt consolidation loan.

Application Process: Online, over the phone, or in person at a branch, you can apply for a Wells Fargo debt consolidation loan. You might receive a decision immediately after submitting an application because it is simple.

Other Lenders Versus Citizens Bank

When compared to other lenders’ debt consolidation loan offerings on the market, Citizens Bank’s product holds up reasonably well. Citizens Bank is a desirable alternative for consumers with good credit because it provides large loan amounts, low interest rates, and no fees. But, other lenders like LendingClub and Wells Fargo provide even lower interest rates, while Wells Fargo provides loans with larger sums. The reduced credit score requirements of some lenders, such as LendingClub and Prosper, may make them more accessible to some borrowers.

It’s vital to keep in mind that interest rates and fees can change based on your creditworthiness, income, and other factors. Hence, even if one lender may offer a cheaper interest rate than another, that doesn’t necessarily guarantee you’ll be eligible for it. It’s crucial to browse around and compare offers from many lenders before you apply for a debt consolidation loan in order to get the best terms possible.

Citizens Bank Debt Consolidation Loan: Benefits And Drawbacks

Citizens Bank’s debt consolidation loan has advantages and disadvantages, just like any other financial instrument. Many significant benefits and drawbacks to take into account are listed below:

Benefits:

• Loans up to $50,000 are available from Citizens Bank, which is more than some other lenders.
• Competitive interest rates: As compared to other lenders, Citizens Bank offers competitive interest rates that start at 6.79% APR.
• No fees: Citizens Bank does not charge any fees for debt consolidation loan applications, originations, or prepayments.
• Applying for a Citizens Bank debt consolidation loan is simple. You can do so online, over the phone, or in person at a branch.

Drawbacks:

• A debt consolidation loan from Citizens Bank requires a minimum credit score of 680, which may be too high for some clients.
• Shorter loan terms: Citizens Bank offers loan periods of up to 7 years, which may result in higher monthly payments and overall interest paid. This is in contrast to other lenders’ lengthier loan terms.
• Due to limited availability, Citizens Bank loans might not be available in all states.

Citizens Bank Debt Consolidation Loan: Is It Right for You?

Citizens Bank might be a wise choice for you if you’re considering a debt consolidation loan, have good credit, need to borrow more money, and want to reduce costs. Nevertheless, if your credit is less than ideal, you want a loan with longer terms, or you need to borrow a greater amount, you might want to consider other lenders like Wells Fargo, LendingClub, or Prosper.

Before applying for any debt consolidation loan, carefully evaluate your entire financial situation to determine whether a loan is the right course of action for you. It’s important to make sure you can afford the new monthly payments and have a plan in place to prevent taking on further debt in the future, even though a debt consolidation loan might simplify your monthly payments and result in savings on interest and fees.

Final Thoughts

Citizens Bank offers a competitive debt consolidation loan program that includes large loan amounts, low interest rates, and no fees. Yet for certain borrowers, particularly those with poor credit or those who seek longer loan terms, it might not be the best option. It’s important to compare offers from several lenders and consider your overall financial situation before you apply for a debt consolidation loan. If you have a strong plan in place, a debt consolidation loan may be a useful tool for improving your financial condition and getting you out of debt.