How To Pay Off $5,000 in Debt
- You can pay off $5,000 in credit card debt by transferring it to a loan or balance transfer card, by paying off balances one by one or by making minimum payments.
- Transferring your balances to a single loan or card with lower rates can save you money on interest and help you pay off debt faster.
- Paying off $5,000 in credit card debt can take anywhere from six months with a balance transfer card to almost 19 years if you just make minimum payments.
The best ways to pay off $5,000 in debt
| Method | What is it? | Best for | Time to debt-free |
|---|---|---|---|
| Debt consolidation or credit card refinancing loan | Using a loan, ideally with lower rates, to pay off debt(s) | Saving money on interest with lower rates | Typically 2-5 years |
| Balance transfer credit card | Transferring multiple credit card balances to a single credit card with a promotional 0% APR period | Saving money on interest by paying the card off before the intro period ends | Typically 6-24 months (assuming you can afford to pay the full $5,000 before the intro period ends) |
| Debt snowball or debt avalanche | Putting extra cash toward one balance at a time while making minimum payments on the other balances | Knocking out debts one by one | Depends on how aggressively you pay down debt |
| Minimum payments on current credit card bills | Paying only the minimum on each balance | People who can’t afford more than the minimum payments | Can be almost 19 years on credit card debt |
Debt consolidation or credit card refinancing loan
A debt consolidation loan or credit card refinancing loan can combine multiple debts into one, giving you a single monthly payment and saving you money on interest if you qualify for a lower rate. This could mean big savings on your $5,000 debt.
LendingTree experts selected the best loans to pay off $5,000 in debt. Learn about how we chose the best lenders.
Best loans to pay off $5,000 in debt
| Lender | User rating | APR | Amount | |
|---|---|---|---|---|
|
7.99% – 24.99% |
$2.5k – $40k |
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7.99% – 17.99% |
$600 – $50k |
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8.99% – 35.49% (with discounts) |
$5k – $100k |
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7.74% – 35.99% (with discounts) |
$1k – $50k |
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6.70% – 35.99% |
$1k – $75k |
| Lender |
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|---|---|---|---|---|---|
| User rating | |||||
| APR | |||||
| Amount | $2.5k – $40k | $600 – $50k | $5k – $100k | $1k – $50k | $1k – $75k |
- No fees
- Pays off creditors directly
- Get money as soon as the next business day
- Need good to excellent credit to qualify (720 minimum credit score)
Consider Discover to consolidate or refinance your debt if you have good or excellent credit. You can keep costs down with low rates and no fees, and Discover will pay your creditors for you once you sign your loan paperwork.
But Discover requires at least good credit to qualify, so check out lenders like Upgrade and Upstart if you have fair or bad credit.
You’ll need to meet these eligibility criteria to get a Discover loan:
- Age: Be at least 18
- Citizenship: Have a Social Security number
- Administrative: Have a physical address, email address and internet access
- Income: Minimum income of $40,000 (individually or as a household)
- Credit score: 720+
- Very competitive rates — maximum APR capped at 17.99%
- No fees
- Sends money directly to your creditors as soon as you sign loan documents
- Must become a member to borrow from PenFed
- No info about what credit score or income you need to qualify
You could save by consolidating or refinancing high-interest debt with PenFed Credit Union, since its loans are capped at 17.99%. Plus, you can skip the hassle of sending the money to your former creditors — PenFed will do it for you.
You’ll have to become a member of PenFed before you get your money, but the credit union makes it easy to apply for a loan and membership at the same time.
To qualify for a PenFed loan, you must meet the following requirements:
- Membership: PenFed membership (anyone can apply)
- Administrative: Open a PenFed savings account with a $5 deposit (may need to submit documents to verify your identity and income)
- Get a 0.25% interest rate discount for allowing SoFi to pay your creditors (certain conditions apply)
- Optional fees
- Pays your creditors directly
- May need to pay a fee to get the lowest rate
- Must have at least good credit
- High maximum APR (35.49%)
SoFi stands out by taking 0.25% off your interest rate if you use more than 50% of your loan to pay your creditors and meet other criteria. Since you’re already planning to use your loan to consolidate or refinance your debt, this is a great opportunity to save.
Keep in mind that to qualify for SoFi’s lowest rates, you may need to pay an upfront origination fee. Otherwise, you can accept a loan with higher rates and no upfront fees.
You must meet the requirements below to get a loan from SoFi:
- Age: Be the age of majority in your state (typically 18)
- Citizenship: Be a U.S. citizen, an eligible permanent resident or a non-permanent resident (a DACA recipient or asylum-seeker, for instance)
- Employment: Have a job or job offer with a start date within 90 days, or have regular income from another source
- Credit score: 680+
- Discounted rate for letting Upgrade pay your creditors directly
- Get money as soon as one business day
- Fair credit OK
- Charges a one-time origination fee of 1.85%-9.99% on every loan
- High maximum APR (35.99%)
Many of the companies on this list pay creditors directly. Upgrade (which partners with banks to fund its loans) and SoFi stand out for offering discounts for using your loan to pay off your creditors. Upgrade is the better option for fair credit, since it accepts credit scores as low as 600.
Still, Upgrade does charge a one-time origination fee on every loan, and its loans can be expensive with a maximum APR of 35.99%. Make sure you’re getting a good deal by using a personal loan calculator to compare your Upgrade loan rates with quotes from other lenders.
To qualify for a loan through Upgrade, you must meet the requirements below:
- Age: Be at least 18 years old (19 in some states)
- Citizenship: Be a U.S. citizen, permanent resident or live in the U.S. with a valid visa
- Administrative: Have a valid bank account and email address
- Credit score: 600+
- Bad credit OK
- Get money as soon as one business day
- Partner lenders may send money directly to your creditor
- High maximum APR (35.99%)
- Only two loan terms available (36 or 60 months)
It’s hard to find affordable loans for bad credit, but the lending platform Upstart accepts scores as low as 300 and caps its rates at 35.99% APR, which is lower than the 36% APR limit that financial experts consider affordable.
That said, Upstart’s 35.99% maximum APR is still expensive, so make sure that the monthly payments fit into your budget before accepting a loan.
Upstart has transparent eligibility requirements, including:
- Age: Be 18 or older
- Administrative: Have a U.S. address, personal banking account, email address and Social Security number
- Income: Have a valid source of income, including a job, job offer or another regular income source
- Credit-related factors: No bankruptcies within the last three years, reasonable number of recent inquiries on your credit report and no current delinquencies
- Credit score: 300+ (unless you’re an eligible college student or graduate, in which case Upstart could approve you with no credit)
Balance transfer credit card
It may sound too good to be true, but you could use a balance transfer credit card to pay down $5,000 in credit card debt without spending a cent on interest. Balance transfer cards often come with an introductory interest-free period that lasts from six to 24 months.
Here’s how much it would cost (excluding balance transfer fees) to pay off $5,000 in debt in the most common introductory periods:
- Six months: $833.33/month
- 12 months: $416.67/month
- 18 months: $277.78/month
- 21 months: $238.10/month
- 24 months: $208.33/month
Here’s the catch: You’ll need good (or even excellent) credit to qualify, and most cards charge a balance transfer fee of 3% or 5% of your balance when you transfer your debt to the card.
Debt snowball or debt avalanche
If you can’t get lower rates with a refinancing loan or balance transfer card, you can use one of two expert-approved debt repayment strategies:
1. Debt snowball method. Focus on paying off your smallest debts first by putting extra money toward your lowest balance until it’s paid off, then tackle the next smallest debt. Continue to make minimum payments on all your cards in the meantime.
2. Debt avalanche method. Pay off cards with the highest interest rates first. Once the balance with the highest rate is paid off, move to the debt with the next highest interest rate. Again, you’ll continue to make minimum payments on all your cards.
It doesn’t matter which method you choose, but you can take control of your debt by sticking with one method until you’re debt-free.
Minimum payments
You can pay off your debt by making minimum payments on your credit cards, but it’s expensive and will take a long time.
If you want access to cheaper (and quicker) debt repayment methods, make minimum payments while you improve your credit score.
The better your score, the more likely you’ll qualify for low interest rates with a credit card refinancing loan, or even 0% intro APRs with a balance transfer card. The less you spend on interest, the more money you can put toward your debt and the faster you’ll pay it off.
You’re not alone. Just under half (46%) of Americans carried a balance on their credit card in the last year, and 3.05% of credit card balances were at least 30 days overdue in Q2 2025.
Even when your debt feels insurmountable, you can work your way back to financial security with credit counseling or debt relief.
Frequently asked questions
Yes, $5,000 in debt can be a lot if it has a high interest rate or if it’s on a credit card with compounding interest (which means paying interest on your interest). You can take control of your finances by refinancing with a low-interest loan or balance transfer credit card or using a more aggressive debt repayment strategy, like the snowball or avalanche methods.
You could see a temporary dip in your credit score when you pay off debt, but your score should recover over time as long as you’re making regular payments on any other debts you owe.
In the age of the side hustle, you can make extra cash by working for a rideshare service, freelancing or even pet sitting.
Our methodology
We reviewed more than 30 lenders and lending platforms that offer personal loans to determine the overall best five companies by these metrics. According to our systematic rating and review process, the best loans to pay off $5,000 in debt come from Discover, PenFed Credit Union, SoFi, Upgrade and Upstart.
Accessibility. We look for lenders with fewer barriers to approval and award points for lower credit requirements, wide geographic access and fast funding.
Rates and terms. We awarded points to lenders based on the competitiveness of their rates and term lengths. Lenders received points for having few (or no) required fees and offering discounts on interest rates.
Repayment experience. We prioritize lenders with convenient self-service tools, responsive support and borrower-friendly perks. We also considered whether lenders offered unique perks to ongoing customers, like free credit scores or financial coaching.