Avant Credit Card Debt Consolidation Loan Review. Avant Debt Consolidation Amounts $2,000-$35,000
Welcome back to The Yukon Project. In this video, we’re going to evaluate the pros and cons of using Avant for credit card debt consolidation. We’ve analyzed millions of credit reports, hundreds of thousands of people’s financial data, and designed programs to help people improve their financial lives. Our goal is to give you the insider’s perspective and provide you with objective information so you can make the best financial decision for your situation.
Pros of an Avant credit card debt consolidation loan
Let’s start with the advantages of using Avant. First, they are willing to lend to people with credit scores between 600 and 700. This is a good range for people with fair to good credit who may not qualify for the very best rates but still have a reasonable chance of approval.
Another positive aspect of Avant is that they lend amounts between $2,000 and $35,000. This is a fairly wide range that should cover the debt consolidation needs of many people. The minimum of $2,000 is particularly noteworthy, as some lenders have higher minimums that may be more than you need to borrow.
Cons of an Avant credit card debt consolidation loan
Now, let’s consider some of the potential drawbacks of using Avant.
Their APRs range from 9.95% to 35.99%. While the low end of that range is competitive, you’ll likely need very good credit to qualify for it. The high end of 35.99% may not provide enough savings to justify consolidating your credit card debt. A good rule of thumb is to only consolidate if you can lower your interest rate by at least 2-3 percentage points compared to your current credit cards.
Avant also charges an administration fee of up to 9.99% when you take out the loan. Other lenders call this an origination fee. This fee comes out of your loan proceeds, meaning if you borrow $10,000 with a 9.99% fee, you’ll only receive about $9,000 while still owing $10,000. However, Avant does offer a prorated reimbursement of this fee if you pay off your loan early, as long as the administration fee was at least 5%. This could help mitigate some of the cost if you plan to pay off your debt quickly. I know of no other company that offers a prorated reimbursement of an administration or orgination fee.
Another drawback is that Avant does not offer the service of using the loan’s proceeds to payoff of your credit cards for you. You’ll need to take the loan funds and pay off your cards yourself. It’s convenient when a company will take care of that for you, but there’s another reason why I think it’s important: lenders that pay your cards directly can sometimes offer better rates since they know the funds are being used for debt consolidation. They know that the loan will replace your other debt instead of stack on top of it. It should make it easier for you to clear their debt-to-income thresholds. Unfortunately, Avant does not offer this service.
Avant’s fees are another con. They charge a late fee of $25. They will also charge you a dishonored payment fee if there is not enough money in your bank account when they try to make the ACH draw for your monthly payment. These fees can add up if you struggle to make payments on time.
Lastly, Avant does not accept cosigners on their debt consolidation loans. A cosigner is someone who will be responsible to repay the loan if you fail to. Adding a cosigner to your loan increases the chances of being approved, getting a good interest rate, and being approved for a larger loan amount. So not having this option does limit your ability to improve your application.
Shop before you decide
As with any financial decision, it’s crucial to compare offers from multiple lenders before committing. At The Yukon Project, we make this easy. Just visit our marketplace page and apply to one of our featured lenders. We’ll check your rate with dozens of lenders behind the scenes without impacting your credit score. Then, we’ll show you all your personalized offers so you can choose the best one for you.
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