You might be able to, however like most things in life, it purely depends on your situation.

Debt Consolidation is a great money strategy that allows you to take all your smaller loans attracting super-high interest charges and “consolidate” them into a new loan with a lower interest rate and perhaps even a longer payment term.

There are a couple of benefits to Debt Consolidation (which by the way is not the same as Debt Review)

• You have one monthly debt repayment.
• You have negotiated a lower interest rate.
• You have most likely extended the payment period which provides you with some much-needed personal positive cash flow.

So why is it that Debt Review seems to be the only offer on the table when you talk to any Debt Advisory business?

Why can’t you simply consolidate your debt?

That is a fair question, and because we get asked it frequently, it warrants a little explanation in this week’s blog post.

The answer is twofold:

• Most people looking to consolidate their debts have simply left it too long, and because missed loan repayments count heavily against you, when a lender looks at your risk, they simply do not want to take it on.

• Most people looking to consolidate their debts are already severely over-indebted and by the letter of the law, no creditor can grant any credit to someone that is already over-indebted.

If you want to consolidate your debt you still need to be in a reasonable financial shape because any lender looking to loan you some money needs to answer one question:

Will I get my money back?

Now, if you have got yourself into financial difficulty, and trust me when I say that it even happens to some of the smartest, most diligent people we have come across in the last couple of years, the first thing to recognize is that you want to act swiftly.

We are currently in talks with a South African company that has been around for almost 200 years and as soon as negotiations are settled, we will be looking to open a new Debt Consolidation channel for all our blog readers and the thousands of South Africans chatting with us on WhatsApp. This is hopefully only a couple of weeks away, so watch the space.

This is the takeaway from this week’s blog post though.

Debt Consolidation and Debt Review are two quite different strategies. Click here to watch our video on the differences between the two.

Debt Review allows us to reduce your overall monthly debt repayments in line with your current affordability, and in most cases that is around 50% of what you are currently paying. In our negotiations with your creditors, we are often able to also get a deal done on lower interest charges. We do not consolidate your debt; we simply use a provision in the National Credit Act to force the creditors to the negotiation table so you can pay less and breathe easily.

It is a legitimate legal service for any South African who really has their back up against the wall and is simply out of options.

Debt Consolidation has nothing to do with the NCR and it is not a legal process at all. It is just a strategy to take all your smaller loans and roll them up into a larger one with a new lender prepared to grant a new line of credit while paying off all the other creditors you owe.

How would you know if you qualify for Debt Consolidation?

It is going to depend on the lender’s requirements but considering what a mess the current situation is in South Africa and how many people are struggling financially, you can guess that there will be quite a few requirements to be met.

Firstly, one of the requirements is going to be:

Are you currently making your full debt repayments each month?

Please try and make sure you keep making your debt repayments even if you aren’t sure what your next move is. Any future lender will be looking at that as a future indication of your commitment to repaying their loan, and that is something to keep in mind.

However, if you simply can’t meet your financial obligations anymore and you feel like the world is starting to close in on you, you should look at Debt Review. It really is a viable option that keeps you legally protected and we have put hundreds of people through the process in a very short period of time all via our WhatsApp Business line.

Super-easy and very secure!

Feel free to get in touch with us via our WhatsApp line. Over 13 000 people already have.

Click here to start a confidential chat with us on WhatsApp

Best regards,

Brendan Els

Director

SA Debt Advisors (Pty) Ltd

NCRDC 3434