NUTS AND BOLTS

CHECK YOUR CREDIT HISTORY

You need to make sure there are no nasty surprises before you visit prospective lenders. If you do find something adverse on your credit history, ensure the details are correct and then let the lender know. This way it can pass your application to a credit manager with a plausible explanation rather than sending it through a standardised computer program, which will knock you back.

DO A BUDGET PLANNER

Chances are you will be in the red but that’s why you’re consolidating in the first place. By wrapping high-interest debts into one low personal loan, your fixed commitments should fall, in turn putting you back in the black. As a rule of thumb, your total monthly fixed commitments should not exceed 30% of your monthly net income.

PREPARE A FINANCIAL STATEMENT

This simply lists your assets and liabilities. This is one of the most important documents. It also tells your lender if you’ve got any equity to secure any personal debts.

WRITE A PROPOSAL

Here’s where you grovel. It’s also a chance to impress your lender because many people are never this prepared. Your proposal should outline why you’re in this situation and how you aim to get out of it. Assure your lender that you won’t fall back into the same financial predicament.