What is a Debt Consolidation Loan?

A debt consolidation loan lets you borrow money, to pay off all your existing debts. By merging all the money you owe into one, consolidation loans let you switch to just one monthly repayment to a single lender. It can be used to pay off credit cards, store cards and other personal loans.

What is the smartest way to Consolidate Debt?

When you start looking for a debt consolidation loan, there are a few steps you can take to make sure you get the right one for your needs.

If you’re thinking of consolidating debt:

Decide how much you need to borrow: Add up all the debts that you want to pay off with your debt consolidation loan. Don’t forget to include any extra charges you’ll need to pay to pay your debts off early.

Think about how long you’ll need to pay it back: The longer you take to pay back your debt consolidation loan, the lower your monthly payments will be. But, of course, the longer you take to pay it off, the more you’ll end up paying back overall.

Look for the lowest interest rate: The interest rate is the biggest cost on consolidation loans, so it’s important to find the lowest rate you can. Lenders advertise their representative APR, but that’s just the rate they promise to give to 51% of borrowers. The rate they offer you could be higher or lower depending on your credit history and other factors.

How do you get approved for a Consolidation Loan?

Getting approved for a consolidation loan is the same as getting approved for any other loan from Fair Money. We look at credit records, affordability as well as other criteria.

Our loan repayment calculator can help you to see how changing the term can affect your monthly payments. By trying out different options with a range of debt consolidation loans, you can see if debt consolidation is suitable for you.

Why choose Fair Money?

If you’re looking to get a loan online, Fair Money could help. We offer short term loans which can be repaid over a period of 1 to 6 months, meaning you can spread the cost instead of paying back in one lump sum. If approved, you can borrow between R2000 and R8000, subject to affordability through our online process.

We can even give you a decision and you may have the funds in your account on the same day.

We don’t charge any late payment fees or early settlement fees, though we do charge an interest rate on the money you borrow as well as an initiation fee and monthly admin fees. However, we will never place any unexpected extra fees, only what was agreed upfront.

How long can I borrow for with a Debt Consolidation Loan?

You’ll find that debt consolidation loans in SA, usually offer terms of between one and five years. At Fair Money, we will offer you up to 6 months to payoff your existing loans and credit cards.

Our loan repayment calculator can help you to see how changing the term can affect your monthly payments. By trying out different options with a range of debt consolidation loans, you can see if debt consolidation is suitable for you.

How do Consolidation Loans affect my credit rating?

As long as you keep up with the repayments on your debt consolidation, you’ll be fine. In fact, you’ll improve your credit score by lowering your debt. But, if you don’t keep up with the repayments, it will negatively affect your credit rating. So you need to make sure you find a debt consolidation loan you can afford.

How can I get the cheapest Debt Consolidation Loan?

It’s not only worth doing debt consolidation if you can find a debt consolidation loan that gives a cheaper interest rate than you’re already paying. Having the security of fixed regular payments can put you on track to payoff existing debt and finally be debt free.

Although there are no best loans, our comparison can help you compare debt consolidation loans, and find the deal that is right for you. Check out consolidation loans, and compare interest rates. Then get your own quote from each lender.

Should I take out a personal loan to pay off credit cards?

At Fair Money we are pioneering the credit card payoff loan. We will help to consolidate your existing credit card debt into cheaper monthly installments to make it easy to pay off and finally be debt free

In fact we have written a great article on credit card consolidation if you would like to find out more.

Is a Consolidation Loan a good idea?

If you’re wondering how to consolidate debt, consolidation loans can be a good place to start. But debt consolidation isn’t your only option. Even the best consolidation loans might not be the best way to consolidate debt, depending on your situation. It’s sensible to look into alternatives as well.

You could look at opening a new credit card which usually give you 55 days interest free. If you are able to, you can payoff your existing loans with the new card and payoff the card within 55 days to avoid any further interest.

Or, you could think about opening a 0% balance transfer card. These are good for people with credit card debts. You can move what you owe onto a single, new card, for a small fee. Then you can pay them back, interest free, over a set period of time.

Unsecured Debt Consolidation Loan FAQs

Do I have to pay off all my debts with the loan?

No, you can choose which debts to pay off. However, if you keep any open you have to show you can afford to pay them back alongside any new loan.

Will the money be paid straight to my other lenders?

No, it is usually paid to you and then you need to pay off each of your debts separately.

Will I have to pass a credit check?

Yes, we will check your credit record when you apply for a loan. Unfortunately if you have a history of not paying on loans on time we will not be able to help you.

How Does It Work?

Apply today with these four simple steps.


Fill in our free and easy online application form. You will need a ID, bank statement and monthly payslip.

Eligibility Check

We will automatically assess your  eligibility against our credit history and affordability criteria.

Approval and Funding

Sign and send back your loan agreement which will be sent to you via email subject to approval. Funds deposited into your account within 24 hours.

Debt Free

Feel satisfied with the feeling of paying off your loan and being debt free