Do you have a home loan, personal loan, car loan & credit cards? Different repayments at different times of the month can be a confusing and stressful not to mention the high interest rates you are paying on the personal loan & credit cards etc.
By rolling your personal loans & credit cards etc into your home loan, you could have one or two repayments per month instead of 4 or 5 and all at home loan interest rates.
It may be that you are finding it difficult to make all the repayments on all the various loans & by rolling them all into your home loan, you may be able to reduce your overall monthly debt repayment.
Even if you do roll all your loans into your home loan, we would strongly urge that you continue to pay as much off the consolidated loan per month as you can.
Each person has unique circumstances, so it’s important to seek individual advice when it comes to debt consolidation and refinancing loans.
Debt consolidation involves increasing your home loan to payout short term debt like car loans, personal loans & credit cards. Given you are now paying home loan rates on all your debt, it may enable you to pay off your combined lending quicker.
With one easy to manage payment, you spend less time worrying about when all your various repayments are due & timing those repayments within you monthly budget.
By reducing the number of lenders, you simplify your finances & get back in control of your money.
By consolidating your debt, you’re usually able to enjoy lower interest rates and payments.
By consolidating your debt into one simple loan, you will more than likely pay a lot less interest. You can put this money towards paying off your debt faster, spend it on household costs or enjoy it as a little treat to yourself. We would recommend paying off your debt quicker.
Different loans with different Lenders can be confusing and stressful. When you roll your loans into one you’re left with one set of repayments and only one lender to deal with. This results in a number of emotional and psychological benefits, including lower stress levels, a greater understanding and control over your finances and an enhanced sense of freedom and relief.
Depending on your circumstances consolidating your debt into one can come with a few costs. Speak to your Better Choice Broker so that they can advise you the total possible charges involved in consolidating your loans into one.
In many instances, the interest you save from paying home loan rates on all your debt, will far outweigh the cost of refinancing. Ask your Better Choice Broker to do the figures for you.
Be sure that you’re able to keep up with new repayments and budget according to your new set of circumstances. While you may find extra money in your account, you should avoid spending in excess or going further into debt.
At Better Choice in Perth, we specialise in providing tailored advice on refinancing loans and debt consolidation. With over 25 years of industry experience, our professionals have access to thousands of products from 35+ lenders. This allows us to offer rewarding and appropriate offers personalised to your circumstances.