Replacing debt with debt

[Not_original]

I have asked the question to myself many times and can't seem to come to a convincing answer.


My scenario currently

I am overinvested in rental properties. It could go south pretty quick, but I do have a few long term renters and things are looking peachy at the moment ( I know this could change )

Two bonds. One sitting at R650k and the other sitting at R1m. Rental on the small one already results in a positive balance ( about 20% positive ), while the big one is shared between myself and someone else staying in a flat, so that is sitting at 40% of the installment

At the stage we acquired these both SO and me were earning decent salaries, now only me with SO studying full time correspondence
Acquiring and building these I managed to rack up some personal loan and credit card debt.
What is left is currently sitting on R120k . Now the CC card remains floating as I am not really in the position to tackle it head on. Personal loan still 27 months to pay.

Would you take out a re-advance and dump it all on the other debt to clear it, freeing up R3500 after considering the raise and doubling of the bond installment which is separate from the main installment so can be managed individually ( it's an Absa thing ) . This will result in me paying it for 7 years. This move will cost me an additional R40k in the long run, but at least it will free up some much needed cash. The cards will be ceremonially destroyed afterwards ( wife has two, I have one, so one will go )

Would you do this?
Thanks for the read.

 

[Kosmik]

Consolidating debt is normally a good thing, especially as you tend to get better rates for a larger debt then for a lot of small ones. HOWEVER, as with any debt and "excess funds" thereafter, if you lack the discipline to maintain that new debt ceiling and treat it as a payment only vs racking up more, you will find yourself in a worse hole.

 

[Nerfherder]

I have asked the question to myself many times and can't seem to come to a convincing answer.


My scenario currently

I am overinvested in rental properties. It could go south pretty quick, but I do have a few long term renters and things are looking peachy at the moment ( I know this could change )

Two bonds. One sitting at R650k and the other sitting at R1m. Rental on the small one already results in a positive balance ( about 20% positive ), while the big one is shared between myself and someone else staying in a flat, so that is sitting at 40% of the installment

At the stage we acquired these both SO and me were earning decent salaries, now only me with SO studying full time correspondence
Acquiring and building these I managed to rack up some personal loan and credit card debt.
What is left is currently sitting on R120k . Now the CC card remains floating as I am not really in the position to tackle it head on. Personal loan still 27 months to pay.

Would you take out a re-advance and dump it all on the other debt to clear it, freeing up R3500 after considering the raise and doubling of the bond installment which is separate from the main installment so can be managed individually ( it's an Absa thing ) . This will result in me paying it for 7 years. This move will cost me an additional R40k in the long run, but at least it will free up some much needed cash. The cards will be ceremonially destroyed afterwards ( wife has two, I have one, so one will go )

Would you do this?
Thanks for the read.

I'm in a similar kind of situation, it might not work for me because of other reasons but I think in your case it would work because you have tenants who are servicing your debt. Rather clear your loan and credit card debt as it will cost you much more long term.
The extra money from servicing this debt can go straight in to one of the bonds. You may need this money accessible for issues with the properties and other emergencies.