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Debt Consolidation

A debt consolidation loan can help you when credit cards and other bills get out of control.

General advice warning

This information is provided without taking into account your objectives, financial situation or particular needs.  You should not take any action in reliance on this without considering your particular circumstances and, if necessary, obtaining professional advice.

 

Use your mortgage to consolidate debts

If you own your home with a reasonable level of equity, a loan top-up to consolidate some personal debts may be a good option for you.

Credit cards that are not repaid each month are expensive.  You could save yourself some money, and a lot of hassle, by consolidating credit card debt, personal loans, and other bills and personal finance into one loan.

 

The pros and cons of debt consolidation

On the plus side

  1. One regular loan repayment could help you to become debt free faster.
  2. Home loan interest rates are much cheaper than credit cards and other personal finance, so a debt consolidation loan could also give you some payment relief and improve your cash flow.

The downside

  1. If it takes you the full term of your loan (say 30 years) to repay your loan, then you may pay quite a lot more in interest on the consolidated debts than you would have if you had stuck to their original payment plans.  That said, this is a hypothetical outcome and most home loans are repaid before their 30 year term. 
  2. Using your home loan (and therefore your home) to repay debts which are unsecured may put your home at unnecessary risk.  If you are struggling to repay your credit card or short term debts, it may not be a good idea to repay them using your home loan. 

 

Please note: This is not financial advice.  It is simply some general comments made for the purposes of explaining some of the considerations that relate to debt consolidation.  Specific advice based on your circumstances will be available if or when it is relevant. 

 

If you don't own your home

Unfortunately, you must own your home or other real estate. 

We do not specialise in debt consolidation for customers that don't own a home or other real estate.

 

Find out more

The process is simple, you just need to apply so we can assess your options.

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