Improve your Finances with Debt Consolidation

Are you struggling to pay your debt?

Lowering the amount you pay towards debt is a fabulous way of improving your finances in a sticky situation. Salary cuts and retrenchment have never been this real before, thousands of people in South Africa are trapped in mountains of debt with no way out. Don’t get desperately caught up in your financial situation. Debt consolidation can assist you to achieve a healthy and debt-free future. Pressure is rising due to a subsequent increase in goods process as well as the expected rise in fuel costs in the coming months. What if you had a chance to provide your family with a better life by allowing yourself breathing space in your salary.

Can you relate to the following?

• You’ve maxed out your overdraft/credit cards
• You are falling behind on more than one debt repayment
• You are barely getting by with little to no monthly living expenses, after paying your debt obligations
• You have no extra money to save
• You’re thinking of selling your assets to help pay off debt
• You’re making new debt in the attempt to help pay off existing debt
• You’re not sure how much money you owe and to whom

If you can, it’s probably time to take action towards improving your finances and also improving your lifestyle by considering debt consolidation.

What is debt consolidation?

Debt consolidation is combining multiple debt balances into one new loan.

TIP: When multiple debts are combined into a single, larger debt, it usually comes with more favourable payoff terms like lower interest rate, lower monthly payment, or both.

Benefits of a consolidation loan

• Only dealing with one institution rather than multiple creditors asking for payment, can reduce a huge amount of stress. 
• It is more affordable to have one monthly repayment at a favourable interest rate than having several payments with different interest rates.
• One manageable payment than several creditors, each with their terms, monthly fees, and interest rates.
• The liberating step is when the process has been completed and the credit bureaus are provided with a clearance certificate upon which they must remove the negative listings on your name as your debt has effectively been fixed.
• Most institutions will be able to half the amount you have to pay per month towards creditors.
• Instant financial relief.

Impact on credit score

If the solution is used to pay off the debt it will assist with increasing a client’s credit score. Clients might at first see a decline in their credit scores, but like anything in life, it has to get worse before it gets better.

TIP: Avoid taking on more debt when your credit score improves

Qualifying for debt consolidation

If you are struggling with your debt repayments and have fallen behind, or are at risk of falling behind, you are over-indebted and will be able to qualify. Clients with a bad credit record or even blacklisted clients will also be able to qualify.

TIP: You have to be employed or have a form of income to qualify for debt consolidation.

Financial relief and costs when applying for debt consolidation

You will experience immediate financial relief and both the counselling and legal fees are incorporated into the debt restructuring plan resulting in you not having to pay any additional/upfront fees for your application to be processed. Legal fees are determined based on the type of debt you have and your monthly repayment. You can cut your monthly repayment by almost half when consolidating.

Protection

Attorneys are appointed to obtain a court-granted order for clients. This will prevent creditors from wrongfully terminating your application. You will then be legally protected and your creditor providers will not be able to terminate your debt restructuring agreement or take any legal action against you.