Learn whether you qualify for a debt consolidation loan in South Africa. Discover requirements, benefits, and how it can help pay off your debts.
16 February 2026 · Fiona Zerbst
Balancing a few debts, such as vehicle finance payments or a student loan, is common. However, juggling multiple repayments, varying interest rates, and due dates can quickly become overwhelming.
If you’re considering a loan to pay all your debts and simplify your finances, debt consolidation – typically through a consolidation loan – may be a solution worth exploring.
Before applying, it’s important to understand what lenders look for when assessing who qualifies for a debt consolidation loan, and how you can improve your chances of approval.
This guide breaks down the key requirements and practical steps to help you evaluate your eligibility.
Tip: Register on the JustMoney platform today to find out if you qualify for a personal loan.
Debt consolidation with a loan combines your debts into one monthly repayment at a fixed interest rate, giving you a clearer path and more confidence in managing your finances.
For example:
Note: The interest rate on your consolidation loan may be higher or lower than your current debts, depending on your credit profile and the lender. While the main benefit is simplifying repayments, it doesn’t automatically reduce the total interest you pay – you’ll need to compare rates carefully.
“If you’re struggling to keep up with various debts, but you’re not completely overindebted, then a debt consolidation loan may be the right option for you,” says Ayanda Ndimande, strategic business development manager of retail credit at Sanlam.
It’s a financial tool designed to simplify your repayments and make monthly expenses easier to manage.
You qualify for a debt consolidation loan if you have a stable income, a good credit score, and pass affordability and risk assessments by lenders.
These checks include:
Note that reputable lenders will never offer debt consolidation loans to clients experiencing financial distress or who are currently in arrears with multiple accounts.
Debt consolidation is most effective if you have a steady income and can manage one monthly payment.
Lenders want to know you’ll pay reliably, which is why they request three months’ bank statements.
You may qualify if you earn a salary, receive commission, or run your own business.
Your credit score gives lenders an idea of how you’ve managed debt in the past. A healthy score increases your chances of approval and helps you secure better interest rates.
Credit bureaus use different scoring models, which means a score considered “good” by one bureau may be viewed as “fair” by another.
JustMoney’s guide to credit scoring bands below can give you a good idea of how confident credit providers may be when lending to you:
901 to 999: Excellent
851 to 900: Good
801 to 850: Okay
601 to 800: Needs work
3 to 600: Not good
0 or 1 to 2: Not enough information to score
If you’re wondering how to qualify for debt consolidation with bad credit, approval may still be possible – but options can be more limited. Improving your score by paying accounts on time, reducing balances, and avoiding multiple new credit applications can strengthen your credit profile over time.
“Maintaining a healthy credit score is an important part of managing your finances, and shouldn’t be forgotten or neglected,” says author and financial planner Sylvia Walker.
“Consciously implement behaviour that will benefit your credit score, and avoid maxing out your available credit, which is an easy trap to fall into, particularly with store and credit cards.”
Explore our credit health resources for practical ways to improve your credit profile.
Lenders look at your repayment history to understand how reliable you are when it comes to repaying debt. Someone who pays on time and in full is less of a lending risk than someone with an inconsistent record.
Even when applying for a debt consolidation loan, you should demonstrate financial responsibility as this makes lenders more likely to approve your loan.
Before you apply, you should try to:
By law, lenders must conduct affordability assessments before granting credit. This involves reviewing your income, essential expenses, and existing debt obligations.
A lower debt-to-income (DTI) ratio generally indicates that you’re managing debt responsibly and improves your chances of approval.
Use our budget calculator to check whether a debt consolidation loan fits into your budget.
You will need the following documents to apply for a consolidation loan:
You may also need to supply recent proof of residence.
Banks will run credit checks as part of their internal assessment.
JustMoney offers a personal loan through Sanlam, one of its valued partners, which can be used to consolidate your debts. With Sanlam, you can access up to R350,000 to help fund significant purchases such as home renovations, furniture or appliance upgrades, education costs, or even major life events.
You’re ready to apply for a debt consolidation loan when several factors work in your favour:
You may not be ready if:
Walker says one of the pitfalls of consolidation loans is that we still tend to pay the minimum amount due each month.
“In this way, you can end up paying off short-term debt over a very long time, incurring additional interest, which will cost you more in the long run,” she says.
“If you want to go the consolidation loan route, rather pay off the additional debt within the same period as the initial debt. You can do this by paying extra into your home loan until this portion is paid off.”
She recommends keeping your own records of these additional payments.
If you don’t qualify for a debt consolidation loan due to bad credit, alternatives include structured budgeting or, if you’re overindebted, debt counselling. Debt counselling is a legal process that restructures repayments and offers legal protection, but restricts access to new credit.
“Unlike a consolidation loan, debt counselling does not provide new credit – it restricts access to further credit and impacts your credit record,” Walker explains
“This is a viable option for people who have considered all other options to obtain financial relief without success.”
Debt counselling and debt consolidation both involve costs and other implications, so make sure you fully understand them before deciding on a solution.
Tip: The JustMoney platform offers a range of financial solutions to make your life easier. Register today and choose from solutions that include a personal loan and debt consolidation.
Most debt consolidation loans are unsecured, so you don’t need to provide collateral.
How much you can borrow will depend on your credit score, income, and affordability. Lenders will only approve an amount that fits within your monthly budget. Some South African lenders advertise loans ranging from R2,000 to R500,000, but typical amounts fall between R250,000 and R350,000, depending on income.
Every application will trigger a credit inquiry, and this can reduce your credit score slightly, although this is temporary. Your score can recover if you manage your loan responsibly.
Not usually. Debt consolidation loans are designed for unsecured debts, such as personal loans or store cards. Home loans and vehicle finance have their own terms and refinancing options.
Debt consolidation – whether through a loan or debt counselling – combines several debts into one. Refinancing means you replace an existing loan with a new one, often to secure a better interest rate or term. You can refinance a single loan, but consolidation covers many debts at once.
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