Putting all of your debts into one loan is called a consolidation loan, and it can be a manageable and affordable way for you to get your finances back under control. Taking out a personal loan is one of the most straightforward ways to consolidate debts. Debt consolidation loans often have lower interest rates than credit cards, store cards and other lending schemes, meaning you could pay off your debts sooner.
Most likely the interest rate on a home loan could be a lot lower than the rate you’re paying on other types of debt, so refinancing your mortgage to pay out your unsecured debts could also be a wise decision. If you want to further reduce your monthly commitments, you may be able to elongate the time you have to pay off the loan compared to some of your current debts.
There are many other advantages of consolidated loans that could potentially save you money in the long run. Debt consolidation loans provide you with a set repayment plan that helps you organise your debt. This plan allows you to have only one single repayment, making it easier for you to manage your money and putting an end to late payment fees. If you are considering a debt consolidation loan for your debts, feel free to call one of our personal debt advisors on 1800 462 767 to discuss if a debt consolidation loan is right for you.