Streamline Your Payments with Debt Consolidation

Bring Your Debts Together, Find Financial Peace

Juggling multiple credit cards, personal, and car loans can be overwhelming — not to mention expensive. If you’re feeling stuck in a loop of high-interest payments with no end in sight, debt consolidation might be the breakthrough you need. Imagine having just one manageable repayment and potentially saving on interest.

Let’s make it simpler for you to manage your debts and free up your monthly budget

Choose the Path That Best Fits Your Financial Landscape

Your Options for Easier Debt Management

Do you have multiple credit cards, personal loans and car loans and it is a struggle each month to make the repayments? Or do you feel like you are making no progress in paying them off? You are not alone. According to the Australian Bureau of Statistics, as of 2015-16 the average household debt in Australia, including mortgages, was $149,600 and growing at an ever-increasing rate.

It is very difficult to pay down significant credit card debt when you are sometimes paying upwards of 20% p.a. in interest on it. If you just make the minimum repayment each month you will almost never pay it off!

Consolidating all your personal debt into one loan will make the management of your debt much simpler and will reduce the overall repayment you need to make each month. Imagine what you could do with hundreds or thousands of dollars extra in your pocket each month.

If you own a home you could potentially pay home loan interest rates on the debt instead of high credit card interest rates.

Types of debt consolidation

At Mortgage World Australia we can help you consolidate your debt two ways 

Secured Debt Consolidation

By securing your consolidation loan against an asset, like your home, you could access lower interest rates and potentially reduce your monthly repayments significantly. Ideal for those who own property and are comfortable using it as loan security.

Unsecured Debt Consolidation

No assets to offer as security? No problem. An unsecured debt consolidation loan still gives you the chance to combine your debts into one easy-to-manage loan, typically with a fixed interest rate. While interest rates might be higher than secured loans, the process is straightforward, with no collateral required.

FAQs

Not sure? Have additional questions? Try here 

Unlike home loans, the interest rates on personal loans are generally not “black and white”. The interest rate will depend on a number of factors such as whether security is offered, whether you own a property, how good is your credit history and how long have you been in your job. To obtain a rate quote please call us.

If you own a property with some equity you may be able to obtain a debt consolidation loan in this situation. If you don’t own a property it would be more difficult to consolidate your debt if you are in arrears.

Even though the interest rate on a home loan may be lower than 4% in many cases (as of 2018) compared to personal loan rates of 11-20% it is possible that you could pay more interest overall if you consolidate a personal loan into a home loan with a 30 year term.

The total interest you would pay on a $20,000 personal loan at 15% p.a. over a 5 year loan term is approximately $8,548. If the same $20,000 is borrowed using a home loan rate of 4% p.a. over a 30 year loan term the total interest paid over the term would be approximately $14,374. So $5,826 more than the personal loan.

So the key when consolidating personal loans into a home loan is to create a separate home loan split and use a shorter loan term. Even taking a $20,000 loan at 4% p.a. over a 10 year loan term would redu

Why not give us a call, or send us an email and get a direct response from one of our finance experts. We’d be happy to give you a hand and help point you in the right direction.

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