How to Get a Loan to Clear Up My Debt

If you owe money to many different creditors, you may find yourself paying only the minimums on all your accounts each month, so your total debt load never decreases significantly. Taking out a large loan to clear up or consolidate all your debts would allow you to make just one monthly payment, as opposed to many smaller ones. Finding a loan with a lower interest rate than you have on your existing debts can also mean that you can pay down more debt each month so that your debt will be paid off faster.

Instructions

1

Talk to close relatives and friends about extending a personal loan to you. Someone who understands your financial situation and has the means to help may be willing to lend you the money to clear your debts without charging you interest. This means that everything you pay the person each month will go directly to paying off your debt, not interest.

2

Seek out a personal loan with a low interest rate if you can't get a no-interest personal loan from a friend or relative. Credit unions or the bank where you have an account may be willing to offer you a loan with good terms. Shop around rather than taking the first offer that sounds good to ensure you get the best loan possible.

3

Fill out the required loan documents and the loan officer necessary documentation, such as proof of income, proof of residence and valid identification. Because personal loan lenders typically run credit checks, it's wise to check your credit report and dispute inaccuracies that may be dragging down your score before applying for a personal loan. This will ensure you get the best rate possible.