Useful Information

Managing Your Debt

Debt Consolidation is a way of paying all your debts with one new loan. You may have too many debts to pay each month, some at very high interest rates. If you qualify for Debt Consolidation you will be able to borrow a certain amount of money at a lower interest rate and pay off all or most of your monthly debts as fast as possible. The money for this loan will be advanced by your mortgage lender if you qualify. You need to own your own home and be paying off a first mortgage bond or have finished paying already. If the mortgage lender considers that you will be able to pay off a second bond on your home, they will advance you a certain amount of money. This amount will depend on how much you still owe on your home, your payment history, and your ability to pay off both bonds at once. You may also qualify for a re-advance, which means that the lender advances you a sum of money up to the original amount of the first bond. Bond interest or home loan interest is usually at a much lower rate than other interest rates, because the loan is secured by your property. The best source for a new loan will be the equity in your own property which has usually built up some increased value over time. The new loan that you get is then used to pay off all your short-term debts or at least the ones that carry the highest interest rates.

What you need to be very careful of is defaulting on this type of loan. If you don’t pay at least the minimum amount to the credit provider every month, you could easily lose your home, and this is the last thing you need to happen. It would be a very good idea to pay off the new loan as fast as you possibly can, and forego all new impulse purchases like a new car, a holiday, a pool etc. until you have managed to pay off the new loan. Many people who receive a loan of this nature tend to forget the reason they took the loan in the first place, and start spending the money on other things instead of paying back the loan as quickly as possible. Try to make a larger payment than the minimum every month, and in this way you will save a fortune in interest, and reduce the term of the loan as well.

You could consolidate your debt by taking out a personal loan, but you should only consider this once you have tried to take out a second bond or a re-advance, as personal loans usually carry very high rates of interest, and this is surely what you want to get away from. You may want to consult a debt expert before you do anything rash, as you need to get yourself out of debt rather than deeper into debt.

Be very aware that by taking out a debt consolidation loan you are replacing short term debt with long term debt, as the term of a bond is usually at least 20 years. This means you will be paying off your loan for many years to come. Once again, the best way to save interest and shorten the term of the loan is to pay back as much as you can possibly afford every single month and never miss a payment.

24 Comments

  • Chantal 7 months ago Reply

    Why is it hard to find a lender if ur blacklisted

    • Amos 7 months ago Reply

      I dont own a property at the moment, but i need to consolidate all my debts

      • Mantwa Mosekidi 5 months ago Reply

        I don’t have a property @ the moment but I need to consolidate my debts

  • stanley 7 months ago Reply

    Hi please help me consolidation I’m paying much I go home without nothing in my pocket

    • Thabo Moeng 7 months ago Reply

      Hi I need a debt consolidation loans bt my account are in arrears so I don’t know if u can help

      • Thabo Moeng 7 months ago Reply

        I Thabo Moeng I need a one new loans just to pay all my debt please I need your help

  • Emmanuel Phetla 7 months ago Reply

    I would lyk to consolidate my debts in jst one monthly installment

  • veronica 7 months ago Reply

    Why u cant get loan if ur blacklisted sometime i want a loan to clare my name and start afresh

  • marshal 7 months ago Reply

    i need money but i dont have a bond on my house

  • Molefi Jonas 7 months ago Reply

    i need to consolidate all ma debts hope wesbank can assist me

  • Emmanuel 7 months ago Reply

    I want 2 consolidate all my loans so that I wil pay 1 acc and around R80 000

  • franzelle 7 months ago Reply

    I need a loan plz help me

  • tebogo 7 months ago Reply

    hi iwant a consolidation loan so that i can pay one installent

  • Mlangeni Bongani Dennis 7 months ago Reply

    Need a loan to consolidate my debt, and conversely build a four roomed house. Kindly, assist where, or if possible: Capitec; Westbank; Standard Bank………..

  • charilee 7 months ago Reply

    Hi If ure blacklist why its so difficult too help the person to clear her name and then she only pay 1 person the money

  • michelle leea-ann 7 months ago Reply

    Hi I want a consolidation loan too pay debt and pay one installment monthly

  • michelle leea-ann 7 months ago Reply

    I want a consolidation loan too pay all my debt pls

  • Duze Simelane 7 months ago Reply

    I want an institution whereby I can qualify as I do not qualify for a consolidation loan.

  • Anthony 7 months ago Reply

    I don’t own my own house but i would realy like you to help me with the consolidation loan cuz i am paying to much debt.

  • Prisscilla khumalo 6 months ago Reply

    I want consolidation to pay all my debt.but I don’t own a house plz hlp.

  • Ntombenhle ngubane 6 months ago Reply

    I need consolidatoin of my debt plz

  • tandie 6 months ago Reply

    i need consolidation loan please

  • Mantwa Mosekidi 5 months ago Reply

    How do I apply for debt consolidation?

  • Mantwa Mosekidi 5 months ago Reply

    I need a debt consolidation,how do I apply?

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