Should You Use Quick Loans to Repay Debt

Over the past few decades, quick loans have gained immense popularity in South Africa. They are used for covering all kinds of emergency expenses.

The question is whether you can use them to repay pending debt and to avoid getting bad credit and getting blacklisted eventually.

The main benefit of quick loans is that the funds you are granted are typically in your account in less than a day after you get approved.

This means that you can cover your debt right away and forget about it. Another benefit is that the approval is quick. Some lenders do not run a credit check. They require only evidence of employment so that they know that you earn some kind of income.

At the same time, the fact that quick loans these loans are available to everyone means that the lenders typically do not determine the interest on an individual basis. Since they assume higher risk with every borrower, the interest rate is fairly high. Given this, you have to figure out how affordable the new loan will be to you. If it will get you into even more debt, then there is little point in using it.

The best way to get a quick loan that is more affordable than your existing one is to shop around. You can now compare online loans in South Africa no matter whether you are based in Gauteng, Pretoria, Cape Town or Johannesburg. Another thing to keep in mind is that such products are offered by smaller lenders rather than by big ones like First National Bank, Nedbank and African Bank.

You can use quick loans to repay existing debt quickly only if they will actually reduce the size of your debt.