How to Get a Personal Loan With High Debt

You can use a personal loan to consolidate debts, make home improvements, pay for college expenses or meet an emergency expense. And if you have an excellent credit history, you can likely get a personal loan with little hassle. But if you have a low credit score or a high debt-to-income ratio, lenders impose additional requirements. Still, it's possible to acquire a personal loan with high debts. You'll likely pay a higher interest rate. But if you can meet the bank's requirements, you can get a loan.

Things You'll Need

• Co-signer Collateral

Instructions

1. Get a secured personal loan. There are two types of personal loans: unsecured and secured. If trying to obtain a personal loan with high debt, it's best to apply for a secured loan. These loans involve collateral, in which you'll need to secure the loan with personal property. Suitable collateral includes an automobile title, jewelry or your home's equity.

2. Use a co-debtor. Having a co-debtor or co-signer with excellent credit and a low debt-to-income ratio can help you qualify for a personal loan with high debts. Although you're the primary debtor and the person responsible for making the monthly payments, if you default on the personal loan, your co-debtor assumes responsibility for the loan.

3. Expect a high interest rate. Even with a co-signer and collateral, some lenders impose high finance fees on personal loans--especially if the primary debtor has a high debt-to-income ratio. A higher rate increases your monthly payments

4. Compare personal loan rates. You won't receive prime rates on a personal loan with high debts. However, comparison shopping can save you money on interest. One lender may charge a 9-percent interest rate, whereas another lender may charge a 7-percent interest rate. Request quotes from two or three lenders.

5. Get an instant installment loan. If you need immediate cash for an emergency expense, and you can't qualify for a bank loan due to high debts, consider a cash advance or payday loan. These loans feature short terms (due within 30 days), and they don't involve credit checks or collateral. All you need is steady employment, an active bank account, a driver's license and a minimum salary of $1,000 a month.