The best way to eliminate credit card debt is to take out a debt consolidation loan with low rates. With reduce interest charges, you can begin to take a bite out of your principal. Without increasing your monthly payments, your debt will be eliminated sooner.

Choosing A Debt Consolidation Loan

You can choose any type of loan to consolidate your credit card debt. But the best rates can be found with a home equity loan. With your homes value securing the loan, lenders offer you the lowest rates. You can also further reduce rates by choosing an ARM.

For those without a home, personal loans can still significantly reduce monthly interest charges on your credit card debt. Loans can be approved the same day for amounts between $1,000 and $10,000. Larger loans require more time.

Whittling Down Your Principal

Consolidating your debts can help you pay off your principal sooner. One option is to pick a short term loan of less than five years. That way your monthly payment should be the same amount as you are currently paying, but with a larger percent paying off the principal.

The other option to pick a long term loan but make extra payments. This gives you more flexibility with your money. By making principal payments early, you trim off interest charges. But it can be tempting to just stick with the minimum payment.

Picking Lenders

Researching lenders and their financing packages can also save you money on fees and interest rates. Compare the APR between lenders, since this includes both rates and fees.

You can easily find rates online by searching on sites of financing companies or brokers. Generic rates will be posted, but you can also request specific quotes by providing some basic information. Quotes including terms will either be emailed or displayed on the website.

Improving Your Credit Score

Reducing your debt will greatly improve your credit score. So will closing paid off accounts. By eliminating unused credit lines, you will have more available future credit at better rates. It will also keep you from using those accounts and racking up more credit charges.