16 Jul What The People Say: Debt Consolidation Reviews

If you’ve thought about taking out a consolidation loan, chances are that you’re looking for a few worthwhile consolidation loan reviews. Luckily, Debt Refinance has put together a few debt consolidation reviews that describe what debt consolidation has been like for them. According to the posts, the important part of debt consolidation is beating the temptation not to overspend.

Read on to find out what people really have to say about applying for debt consolidation.

“Do not underestimate the advantage of consolidating your debt

The difference between an average credit card rate and a consolidation loan is roughly 40% of the total debt every 4 years, 96% after 8 years, and 274% after 12. This can dramatically improve your ability to pay debt.

For those of you not aware, nearly all financial institutions offer consolidation loans to get people out of credit card debt. For those of you with high rates, consolidation loans can have massive effects on your ability to pay down debt.

Comparing the average 16% card to a 7.24% consolidation loan will save roughly R4000 for every R10,000 every 48 months. This means an R150 payment pays off twice the amount of debt instead of half of the payment being wasted on paying crazy credit card interest.

The effect of reducing your personal loan interest rates cannot be expressed enough. Interest builds on itself and grows exponentially.

Consolidation loans are also far better for your credit score because they count as loans and not as credit card debt, which will dramatically improve your credit score, as the two kinds of debt are scored completely differently.”

Shorter Reviews: Is Debt Consolidation A Good Idea?

“I did this when going through my divorce. 2-3% is cheaper than a 9% loan. Depends on if your credit utilization and credit score and handling it.

I would only recommend this if you have the discipline NOT to spend.”

“It’s a good idea if you’re not going to see the credit cards you just paid off as “available for spending.” You need to treat them as if they don’t exist now, otherwise you’ll have R10k in credit card debt again AND the debt consolidation loan.”

“It’s a good idea if you get better habits about tracking your spending. If you don’t resolve that you’re only treating a symptom and not the root cause.”

“I did this too, and through budgeting, I was able to afford about the same amount towards debt every month. I’m also a healthcare worker and it’s not like I’m even close to being rich. Some people also need the consolidation to lower their monthly payments just to get by. I’m sure with how the world is right now, even more people may need that to get by.”

Both of these emphasise that for consolidation loans to work, you should stop taking out further credit. It’s a good idea if you want to pay off all your debt at once.

A Healthcare Worker’s Story

“I got a Debt consolidation loan mainly so that when I make a “minimum payment” of like R1000, it’s actually R1000 and not R750 or R500 because of the compounding interest charges after the fact.

I was paying off my credit card debt regardless, but the money just goes that much further. Also, the key word for me was “consolidation”.

I had 5k on 1 card, 5k on another card, and 4k line of credit through Capitec.

On top of all my other bills, I had a little spreadsheet going for rent, phone bill, this card, that card, on these dates and when they are due.

Now I have 1 simple easy payment and I’ll most likely be done with about 10k of debt in under 10 months.

Again, not that this wouldn’t happen without it, but compounding interest sucks, and the consolidation of a single payment is huge.

I’ll also add, this works better, if not works at all, because credit card APRs are usually in the mid to high 20s and personal loan interest can be way, way lower.”

As you’ve read, a lot of people have had positive experiences with consolidation loans. It’s saved them money on interest, boosted their credit scores, and enabled them to make faster repayments. See what a consolidation loan could do for you– contact Debt Refinance today.