Before you apply for a personal loan...

It’s that time of year where our finances can easily go downhill. A quick personal loan can be a great relief if ends just won’t meet after your holiday, Christmas and entertaining the family. Of course it is better not to over spend in the first place, but it happens.

Shop around before deciding on a loan. Fast personal loans like payday loans are expensive because credit providers charge high interest rates and admin fees. Banks’ personal loans are standardized, but it’s still worth looking into the different kinds of loans.

Some consumers opt for consolidation loans to make their debt more manageable instead of getting a loan to afford their living expenses. This is a very good idea. When consolidating your debt you can make your debt more affordable by applying for a secured loan with the lowest possible interest rates.

When you consolidate your credit you only have one repayment per month which makes it easier to avoid debt collectors as you will only have one loan to repay and keep track of. The new loan’s repayments can be less than the combination of your current small loans, credit cards, store accounts and other credit facilities.

This sounds like great news, but only if you can qualify for a secured loan. If you are already overcommitted or if you have a bad credit record you won’t be able to get a consolidation loan and save this way. You can apply to have your debt restructured, however, and get the same benefits as you would have enjoyed with a consolidation loan.

This easy alternative to personal loans or consolidation loans makes it possible, even for blacklisted people, to make your debt affordable and to only have a single repayment each month. A credit counsellor reviews your debt repayments and negotiates a new, affordable payment structure with your creditors.

Debt restructuring is the most affordable form of debt management in South Africa as your debt counsellor’s fee will depend entirely on your affordability. 9 out of 10 South Africans who opted for debt restructuring experienced debt relief and were glad that they opted for the help of a credit counsellor instead of another personal loan.