Question 1

What is debt consolidation and how does it work?

Accepted Answer

Debt consolidation combines multiple debts — credit cards, personal loans, car loans — into a single loan with one repayment, usually at a lower blended interest rate.

Question 2

Is debt consolidation worth it in Australia?

Accepted Answer

It depends on the rate spread and your discipline. If you can cut the blended rate meaningfully and you close the old accounts, it can save interest and simplify your finances.

Question 3

What types of debt can I consolidate?

Accepted Answer

Credit cards, personal loans, car loans, buy-now-pay-later and other unsecured debts can typically be consolidated. Some debts (e.g. HECS) cannot be rolled into a home loan.

Question 4

Should I consolidate into my mortgage?

Accepted Answer

Rolling debts into your home loan gives the lowest rate but converts unsecured debt into secured debt — your home is at risk if you miss repayments.

Question 5

Will consolidation hurt my credit score?

Accepted Answer

A consolidation application creates a credit enquiry, which can cause a small, temporary dip. Closing old accounts and making on-time repayments on the new loan rebuilds your profile.

Debt consolidation in Australia, without the guesswork.

Frequently Asked Questions