Various forms of debt consolidation exist, however the concept includes rolling all of your debt from various credit providers into one single debt payment. If handled correctly, debt consolidation can bring financial freedom by relieving the weight of overwhelming debt, but debt consolidation can also affect your credit score.
A debt consolidation loan has a positive impact on your credit score. To credit agencies, paying off several different accounts with the consolidation loan makes it seem as if you have paid off accounts. The consolidation loan appears as a new credit account but accounts paid off are always positive in the eye of credit agencies. In repaying your new consolidation loan, it is important to make consistent, on time payments. This step also positively affects your credit score, however it does take time.
If you start using other credit card accounts, which is not recommended, pay the bills promptly to continually improve your score.
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We will be able to offer advice on the suitability of debt consolidation to your specific financial situation, as there are instances where it would prove unsuitable. Our consultants will be able to help you with regards to secured and unsecured debt consolidation, and advice as to which would be most favorable to your outstanding debts. Operating on a national basis, we can also provide you with debt counseling or a debt review in South Africa. As mentioned, debt consolidation could save you on monthly payments and interest rates, which has made it a viable option for many. To find out if debt consolidation in South Africa is an option for you, contact Quick Consolidation Loans today.