Consolidating debt with standard bank dating for older woman

People who apply for a debt consolidation loan are either already financially stressed or in danger of going that way.

And too many mistakenly expect debt consolidation to be a panacea for all their ills – when it’s more like putting a plaster on a serious wound. While that is true, it’s also true that there are savvy ways to deal with debt.

In fact, your debt is still there – you’ve just moved it, they say.

And the habits that landed you in debt probably haven’t disappeared either.

“It’s a short-term fix, not a remedy for the underlying problem,” says Paul Slot, the president of the Debt Counsellors’ Association of South Africa. For example, your home loan is usually your cheapest form of credit.

At a glance, it seems a great idea, giving both interest savings and better cash flow. Penwarden says despite the interest saving each month, the reason you pay R3 500 less each month is that, instead of repaying your debts over three, four or five years, you are now extending that same debt to 20 years (the notional period of your bond).

Here’s why a Debt Consolidation Loan could be right for you: Applying for your Consolidation Loan is quick and easy. *Representative example: All prices include VAT, R20 000 borrowed for 12 months .

In just a few simple steps you could be on your way to personal financial freedom. Once off initiation fee (capitalized) R 1197 , Monthly admin fee R68.40.

On the other hand, credit cards, store cards and short-term loans incur interest of anything from 21 percent a year to 32 percent over six months.

For this reason, many people use their home loans to finance big-ticket items such as appliances or furniture, making sure they don’t stretch the repayments for such depreciating assets over the term of their bond.

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