I Used a Personal Loan to Payoff My Remaining Credit Card Debt 💳

Sometimes life just happens. I was very close to paying off the remaining credit card debt that I had and then had a family emergency. Not wanting to spend any money from my emergency fund, I decided to put the cost of a plane ticket, rental car, and a few other items on my credit card. Yikes! It really hurt to put more debt after I had worked so hard to bring it down to 0. However, I knew that I had to help my family member and I would be able to pay it off in the future.

After I made multiple purchases it hit me, “Why don’t I just apply for a low interest personal loan to payoff my high interest credit card debt?” I was shocked that I hadn’t thought about this sooner. My credit score is just over 700 after ten years of hard work and starting from the mid 400’s and knew that I could get an interest rate better than 24% APR (which is what my credit card was costing me). I did some quick research and decided to try with Upstart, which is a personal loan company that looks at more than just your credit score and takes a holistic look at you by considering your level of education, assets, income and a few different factors. I decided to check them out through Credit Karma to see what kind of rates I could be eligible for. To my surprise, there wasn’t a hard pull on my credit for the application. A hard pull was only done after I decided to accept the loan. This is awesome and I wish that more companies did this.

I ended up qualifying for a 10% interest personal loan which was less than half of the interest rate on my credit card!!! The process was quick, easy, and deposited the money into my bank account the next day. I know that this doesn’t mean that my debt ‘disappears’ but I would be able to pay it off without paying a ridiculously high-interest rate. I set up a monthly direct deposit for payment that was higher than the minimum payment and brought down the payoff timeline from 3 years down to 2.5 years. Although I won’t take this long to pay it off, it’s nice knowing that I have the option if needed.

Now I can breathe much easier without the stress or having high interest credit card debt to pay off. I’ve gotten them all down to zero and have only one purchase going through each one per month in order to keep the lines of credit open and prevent the cards from being closed. I wouldn’t want to lose the access to credit and credit length history that I have. I setup all of the credit cards to payoff the credit card statement each month. I feel like such a weight has been lifted off of my chest. Although I have delayed my debt payoff a little bit longer, I’m saving money along the way and having more peace of mind with my personal loan from Upstart. I’ve realized that personal life is just that, it’s personal. Sometimes life happens and you have to spend money that you didn’t expect to spend. I’m still investing monthly into my Roth IRA and my taxable brokerage account. I’ll be able to still comfortably invest and payoff this personal loan.

Overall, I had a great experience using Upstart to pay off my credit card debt. This may be a better option for many people that are looking to pay off their credit cards, consolidate their debt, and pay for an unexpected purchase. Although a 10% interest rate isn’t necessary ‘low’, it’s still soooooo much lower than a normal credit card’s interest rate. If you’re interested in using Upstart yourself, feel free to check them out by clicking this link.1

Feel free to share any comments below if you’ve also used a lower-interest personal loan. Thanks for reading!