Payoff is an online lender that offers personal loans designed to help borrowers pay off or consolidate their credit card debt. The company provides a simple application process that allows users to ask for loan amounts between $5,000 and $35,000 and check potential interest rates without hurting their credit score.
Payoff loans are unsecured, fixed-rate personal loans that include an origination fee between 0% and 5% and APRs between 5.99% and 24.99%, depending on the amount borrowed and the term length. Loans are fully paid at the end of the term, and terms range from 24 to 60 months.
For borrowers in search of straightforward personal loans to help manage credit card debt, Payoff provides a streamlined solution. Lacking any other loan products, however, this lender isn’t the best fit if you need mortgage, HELOC, or vehicle financing.
How Payoff stacks up
- Easy online application process for personal loans
- Checking rates doesn’t negatively impact your credit score
- No prepayment, late or annual fees
- Origination fees charged on every loan
- Rates vary significantly depending on your credit score, the amount borrowed and term length
- No other loan products offered
What’s interesting about Payoff
Payoff is notable for its focus on paying down credit card debt. By securing loan funding from a variety of trusted sources, Payoff is able to offer borrowers multiple term-length and rate choices. Soft credit checks mean that applying for loans and evaluating rates won’t negatively impact credit scores, and the entire process can be completed online: apply, verify your information, e-sign critical documents and then have money deposited directly into your bank account.
Things to consider
To cover its costs and fees, Payoff applies an origination fee to every loan. This amount varies by loan amount and length and is deducted from the total amount deposited into your account. Payoff also focuses specifically on reducing credit-card debt; its loans are purpose-built to pay down or consolidate credit balances into a single monthly payment. While this often means reduced rates for borrowers, it also limits Payoff’s product range — the company only offers personal loans to pay down credit card balances.
It’s also worth noting that Payoff is not available in Massachusetts, Mississippi, Nebraska, Nevada, and West Virginia.
As noted above, Payoff is focused on helping borrowers reduce their credit card debt. According to its website, using personal loans to pay off credit card balances can boost your FICO credit score; some borrowers have reported increases of up to 40 points.
Borrowers can use Payoff’s online portal to apply for loans from $5,000 to $35,000 with APRs that are competitive with similar online lenders. If you qualify for a loan, you’ll receive multiple offers with different rates and term lengths and can pick the one that best suits your budget. Payoff offers term lengths from 24 to 60 months, allowing you to choose how long you want to or can be on the hook for this personal loan. Your monthly payment includes interest and principal, and at the end of your term, the loan is entirely discharged. You can make prepayments with no penalty, and there are no late fees or annual fees for any Payoff loans.
Payoff doesn’t offer secured loans, which means it’s not able to offer any mortgage options.
If you’re looking for a mortgage loan, consider options like Better. This online lending company lets you apply online for a mortgage estimate and eliminates typical loan fees. Estimates are completed almost instantly after filling out paperwork online, and you get full transparency into the mortgage-application process including the current application step and what comes next. So far, the company has funded $3 billion in mortgage and refinancing loans.
Better offers 5/1, 7/1, and 10/1 ARM mortgages along with 15-, 20-, and 30-year fixed options, all at rates that are comparable to brick-and-mortar banks.
Payoff does not provide any mortgage-refinancing products.
One option for home refinancing is Guild Mortgage, which offers an online-refinancing calculator to help estimate the costs and benefits of refinancing your current mortgage. This lender provides both fixed and ARM refinancing options along with “reverse mortgages” for owners over age 62 looking to access the equity in their home.
Home equity loans and HELOCs
Payoff doesn’t offer any home-equity or HELOC solutions.
Lenders such as Axos offer home-equity lines of credit (HELOCs) to homeowners; these secured credit lines come with variable interest rates that are often significantly lower than unsecured credit options. Axos HELOCs come with average market rates with discount options for qualified borrowers, and all HELOC fees are waived for the first year. Borrowers can apply online by providing basic information about their current finances and the value of their home.
Payoff does not provide any options for car loans.
If you’re looking for a vehicle loan and prefer not to use dealership financing, other online options include lenders such as Carvana. This company offers an online application form that provides instant offers and terms without negatively impacting your credit score.
The site also lets you search for potential best-fit vehicles based on your current finances and works with many major lending institutions to offer multiple financing options. Borrowers have seven days to test-drive their vehicle — and can return the car if it doesn’t meet their needs.
The final word
Payoff provides a credit-focused personal-loan product that’s easy to access and can help borrowers pay down credit card debt and improve their FICO score. Online applications are simple and let you select the amount, term and rate that best suit your finances. There are no prepayment, annual or late fees for any Payoff loan, and all interest rates are fixed.
Borrowers are subject to origination fees on all Payoff loans, however, and while initial applications won’t damage your credit score, the company does perform a hard credit pull before final approval that could lower your overall credit rating. In addition, Payoff doesn’t offer any mortgage, refinancing, home-equity or car-loan products.
If you want to eliminate credit card debt and reduce interest payments, Payoff personal loans are a great option. If you need mortgage, vehicle or HELOC financing, you’ll need to look elsewhere.