What is the best way to get rid of a high interest loan?

My credit is not perfect but is getting close. I have a car that is paid off and blue booked at $16,000. Could I use this as collatoral?

the loan is for $8,000 and the intrest rate is 25%. This is my only debt and was hoping to stop paying $175 per month in interest!

I disagree with the above answers about getting a loan for a car you already own - I think it's pretty simple - If you have a collateral and its blue booked for more than you want to borrow and you have proof of income to pay for the loan - Pretty Simple!! The bank may only want to loan up to 80% of the value of the car - but if you only owe $8,000 - your well under the 80% - the car % rate would be well under the 25% rate your receiving now - and then try looking at your finances and try making at least 1 extra payment a year! that will significantly lower the term of your loan! I would start contacting local banks in your area and find an loan officer to work the numbers with you -

Good Luck!

Financing a car that you already own is pretty difficult. But you might contact some of the companies that do used car loans and ask. It's worth a few phone calls.

How much is your loan for and what is the rate?

The best answer will be to reduce spending everywhere else and pile on the cash you pay towards that debt.

You could, but it might be able to go to a bank and get a loan using it as collateral, but it's difficult. Banks are becoming completely uninterested in secured loans, and would rather go straight to unsecured. Your best bet may be to keep paying the high interest until your credit shapes up, or possibly try to refinance the loan through the lender you used or its competitors.

Pay back the loan. Simple.

You should check out www.prosper.com . It is a peer-to-peer loan site. The interest rates you get correlate with how good your credit score is.

Even if you only have mediocre credit, you should be able to get an interest rate less than 20%. The loans on that site are for fixed rate loans that you pay back over 3 years.

I am a lender on that site, and I think it's a great way for people to (responsibly) consolidate and reduce their debts.