Here’s what you need to know about consolidating your debt.

Debt Consolidation 101

Debt Consolidation allows you to combine your debt into a single manageable loan, providing one single reduced monthly repayment.

How Debt consolidation works

Combining multiple balances into a new loan

A new loan reduces the number of credit obligations and how much you’re spending on interest

• Credit card
• Retail account
• Student loans
• Personal loans

Pay lower interest 

You can apply for a consolidation loan or take out a personal loan and potentially pay a lower interest rate.

The other debt is then paid off, and payments are made on the new loan.

Having a single monthly amount means you also pay less monthly in repayments, making it more affordable and lowering the overall cost of the loan, freeing up cash to make other payments to save and invest.

BENEFITS OF CONSOLIDATING DEBT

• Manageable payments
• Only pay off one loan amount
• Frees up cash and improves your affordability
• Can lower your interest rate

BEFORE APPLYING FOR CONSOLIDATION

• Get to the bottom of why you’re in debt.
• Check your spending habits so you won’t be tempted to rack up more debt.
• Ensure you understand your potential new interest rate and whether there are additional fees involved.
• Have a plan about how you’re going to pay back the loan.
• Will you be able to keep up with the repayments?