Borrow money with a bad credit record and you are on your way to get blacklisted finance. The only way to get out of your cycle of debt is to pursue debt consolidation. In South Africa, lenders are extremely lax on their lending conditions and will give you loans until you cannot see a way out. The difficulty with these loans is that they are rarely secured loans, which means you are left with very high interest rates and even higher repayments. If you choose to consolidate all of your debt, it means a lower interest rate and only one repayment for month which helps you to take control of your finances more effectively.
The reason it is a bad idea to borrow money with a bad credit record is because you are likely to enter a cycle where you owe more than you can possibly repay. This is fine if you anticipate a short spurt of debt, for example when you are purchasing your house or car, but not fine in the long term. You get on blacklisted finance lists when you don’t make your monthly repayments. For many of us this happens because there are too many lenders to pay, and too few secured loans to access. If you are in South Africa and want to stop this happening to you, then find out more from your bankers about debt consolidation.
Debt consolidation allows you to pay off your multiple accounts and lenders all in one go and helps you to put all of your debt into one account. This means one monthly repayment, and one interest rate to deal with. It makes you more likely to get off the blacklisted finance list, and more able to improve your credit rating.