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Step 1
Ask friends and family for a loan. This is often hard to do because many of us carry such pride when it comes to our finances. We do not want to appear weak, or that we have over-reached. But the truth is, there are many instances when you simply need the money. Now that you've taken it, what you've spent it on in the past doesn't matter. It's about being financially healthy in the future. The cheapest place you are going to get money is from friends and family. This is because they will probably not charge you interest. Or, if they do charge you interest, it will be simple interest versus compound interest, and it also doesn't appear on your credit report. The whole trick to borrowing from friends and family is to prove that you are worthy by paying the installments on time, every time.
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Step 2
Open another credit card and transfer the balance. You can't live in America without being besieged by credit card offers. Look at what the credit card companies are offering you. If you have a card at 20 percent and you can move that balance to 5 percent for the life of the loan, you will literally save yourself thousands in interest on debt as small as $10,000. Just be sure that you never default on the loan, since then the interest rate will skyrocket. Also, look for transaction fees (usually 3 or 4 percent with a monetary cap). Do the math and see if it makes sense for you.
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Step 3
Call the credit card company and ask for a rate reduction. By threatening to take your balance elsewhere, you may shave a few percentage points off the top. It doesn't sound like much, but you'll realize it when you suddenly pay off your debt several months earlier than expected.
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Step 4
Contact a debt consolidation company and see if they will give you a loan. This usually pertains to student loans. Some student loans can be as high as 10 percent. There are many companies who will undercut that cost and charge you half as much to pay down your education loans.
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Step 5
Take a home equity line of credit. This, of course, assumes that you own a home and that there is a significant amount of equity in it (usually at least 20 percent). If this is the case, you can get a home equity line that is much lower than the average credit card rate (usually between 5 and 7 percent). Also, and this is the big advantage, the interest on a home equity line is tax deductible. The interest you pay to a credit card company is not.
