Marcus is an online branch of Goldman Sachs Bank. It offers debt consolidation loans that can be in your account a day after applying; along with high-yield online savings accounts, and certificates of deposit.
No fees and low-interest borrowing rates make Marcus debt consolidation loans a great option for consumers with good credit. A credit score of 660 or higher is enough to win approval, though Marcus will evaluate other factors as well, like your debt-to-income ratio (DTI), employment status, and income.
A debt consolidation loan can simplify your payment schedule and lower your interest rates. However, not all loans are worth applying for and some may be a waste of your time. Below, we run through the basics of a debt consolidation loan with Marcus and help you decide if it’s the right option for lifting yourself out of debt.
- Type of Debt Relief – Debt Consolidation Loan
- Eligibility & Requirements – 660 credit score
- Fees – no fees
- Credit score impact – Minimal
- Consumer Reviews – Mixed
How the Marcus Debt Consolidation Loan Program Works
When you take out a debt consolidation loan with Marcus, you have two options:
- Take the money and repay each of your creditors
- Allow Marcus to repay your creditors directly
Marcus calls the second option “direct payment for consolidation”, and it can save you the hassle of having to repeat your billing info to multiple creditors. You can borrow between $3,500 and $40,000 with terms ranging from 36-72 months. The loan terms you choose may affect your rate. Generally speaking, interest rates for 36-month loans will be lower than rates for 72-month loans.
Depending on your creditworthiness, the loan term you choose may not even be up to you. For instance, 72-month loan terms aren’t always offered. Your monthly payment is determined by your loan amount, APR, and loan term.
How to Apply for a Marcus Debt Consolidation Loan
Here are step-by-step instructions on how to get a debt consolidation loan with Marcus:
- Head to Marcus.com and hover over the “Loans” tab
- From the drop-down menu, select “Debt Consolidation Loans”
- Tell Marcus how much you’d like to borrow ($3,500-$40,000) and why
- Insert personal info, name, address, income, housing payment
- Plug in your SSN and undergo a soft credit pull that doesn’t affect credit score
- View your loan options and select your favorite
- Apply and undergo a hard credit check that will ding your credit score for a short time
- Sign the contract. Funds come in 1-5 business days
If your application is declined, Marcus will contact you within 7-10 business days and let you know why.
Marcus Debt Consolidation Loan Eligibility & Requirements
Marcus offers debt consolidation loans to consumers over 18 (19 in Alabama, 21 in Mississippi and Puerto Rico), with a U.S. bank account and Social Security or Individual Tax I.D. number. It does not accept joint applications or cosigners, which can boost applicants with weaker credit profiles.
There is no listed income requirement, but you will need a credit score of at least 660 to qualify. A higher score will lock in a lower rate, and the best rates are reserved for those with pristine credit profiles.
If you’re applying for a loan with Marcus, you’ll want recent paystubs handy to verify your income. Marcus may even call your employers directly, but they won’t discuss your application. It’s just another way to make sure you make how much you say you do. Self-employed workers can upload the last three months of personal bank statements (business bank statements or Individual Income tax returns (Form 1040) are not accepted).
Fees for Marcus Debt Consolidation Services
Marcus debt consolidation loans have no fees. You pay principal and interest – that’s it! Fixed APRs for a Marcus loan range from 6.99% to 19.99%.
There’s not even a late fee. If you’re late that means you’re not paying down the principal, which will lead to more interest building up. The end result is you pay more interest throughout the loan.
If you stop paying your debt consolidation loan, you will default under your loan installment agreement, which ends up on your credit report. Missed, late, and partial payments can all wreak havoc on your credit report, damaging your credit score and costing you thousands in future loan agreements.
In contrast, paying early or paying more than what’s due can save you in interest over the life of the loan.
Pros & Cons of Debt Consolidation with Marcus
Pros of Marcus
- Interest rates as low as 6.99%
- No fees
- 25% autopay discount
- On-time payment reward
- Active service members eligible for lower loan rate
Cons of Marcus
- Need 660 credit score to qualify
- No physical locations
- No joint-loan options
A loan with no fees attached is hard to pass up, especially when it comes with APRs as low as 6.99%. Just remember, you’ll need top-tier credit if you want to take advantage of the best rates.
Marcus rewards borrowers for paying on time every month. If you pay your loan (on time and in full) every month for 12 straight months, you can skip a month. You won’t accrue interest for that month, but Marcus will tack on an extra month to the end of your due date. So, it’s more of a deferral than a free month, but it could still be used as a way to catch up on your bills if you’re finding yourself overextended during the repayment process.
Is a Marcus Debt Consolidation Loan Right for Me?
A Marcus debt consolidation loan is for someone with good-great credit. Remember, you need a 660 just to qualify, and if you want to take advantage of the lowest rates, you’ll want to surpass the minimum qualifications. Marcus focuses on credit card debt and will consolidate up to 10 credit cards. You cannot, however, consolidate student loan debt.
If you’d like flexibility in switching your due date, Marcus could be right for you. It lets you change your due date up to three times during the life of the loan. This feature isn’t always a guarantee and there are certain moments when you won’t have access to it:
- If you have any past due amounts outstanding
- During a payment deferral
- During the final monthly payment period
Marcus is a way for Goldman Sachs to enter the online lending marketplace, and all loans are issued by Goldman Sachs Bank USA, Salt Lake City Branch. Goldman Sachs was founded in 1869 and has been an accredited member of the Better Business Bureau since 1946. If you’re looking for experience, Marcus has this in abundance, as it is backed by one of America’s oldest financial institutions.
Active duty and retired veterans and their spouses could be eligible for interest rates as low as 4% under the Service Members Civil Relief Act. However, refinancing your loan could cost you these benefits along with other protections available to borrowers suffering financial distress. Don’t refinance without knowing what rights you may lose; you might regret it down the line.
Alternatives to a Marcus Debt Consolidation Loan
Marcus is one of the countless companies offering forms of debt consolidation. If you didn’t qualify or weren’t wild about certain terms and conditions, rest assured there are plenty of other options. Here are a few:
A debt management plan (DMP) pulls your debt together just like a debt consolidation loan. The difference is a debt management plan doesn’t require another loan. The nonprofit credit counseling agencies that offer DMPs have agreements with card companies to reduce interest rates on your debt and lower your monthly payments to affordable levels. You pay the DMP agency once a month, and it then turns around and pays each of your creditors. This frees you from juggling multiple monthly payments.
LightStream Debt Consolidation Loan
LightStream offers interest rates as low as 5.95% and no fees. They’re another good option for those with good credit looking to benefit from debt consolidation.
Avant Debt Consolidation Loan
Avant caters to consumers with lower incomes who struggle to find financing from places other than payday lenders. If you have poor credit, you could get stuck paying their 36% interest rates on debt consolidation loans. However, it could be worth considering if your situation is dire enough. It beats filing for bankruptcy or dealing with a payday lender. Avant accepts credit scores as low as 580.
Marcus Debt Consolidation Loan Reputation & Consumer Reviews
Marcus has an A+ accreditation with the Better Business Bureau. It has had 177 customer complaints in the last 3 years and 100 complaints in the last 12 months. Customers complained about unresolved statement disputes, system glitches, and lack of communication. However, some customers were pleased with the Marcus app (IOS and Google Play) which lets you manage your accounts and schedule payments straight from your phone.
About The Author
Bents Dulcio writes with a humble, field-level view on personal finance. He learned how to cut financial corners while acquiring a B.S. degree in Political Science at Florida State University. Bents has experience with student loans, affordable housing, budgeting to include an auto loan and other personal finance matters that greet all Millennials when they graduate. He has a prodigious appetite for reading, which he helps feed with writing from Scottish philosopher Adam Smith, the “Father of Capitalism.” Bents writing also has been published by JPMorgan Chase, TheSimpleDollar and Interest.com.
- N.A. (ND) Rate and Loan Terms Disclosure and Loan Options Disclosure. Retrieved from https://www.marcus.com/us/en/disclosure/rate-disclosure
- N.A. (ND) Personal Loans for Debt Consolidation. Retrieved from https://www.marcus.com/us/en/debt-consolidation-loans
- N.A. (ND) Marcus: Frequently Asked Questions. Retrieved from https://www.marcus.com/us/en/faqs
- N.A. (ND) Marcus by Goldman Sachs. Retrieved from https://www.bbb.org/us/ut/draper/profile/loans/marcus-by-goldman-sachs-1166-90015433