Services · Refinancing & equity
Debt Consolidation Home Loans
Juggling a car loan, a couple of credit cards and the mortgage all at once is exhausting, and the interest on the small stuff is brutal. Folding those debts into your home loan can drop your total monthly repayments a long way. It can also cost you more over time if you're not careful, so let's do it properly.
How it works
Credit cards and personal loans usually carry much higher interest than a home loan. By refinancing and pulling that debt into your mortgage, you swap several high-rate repayments for one lower-rate one. The monthly saving can be significant because the home loan rate is lower and the balance is spread over a longer term.
The catch worth understanding
A five-year car loan stretched over 25 years costs more interest in total, even at a lower rate. The monthly number drops, the lifetime number can climb. The fix is simple: keep paying the old amount into the consolidated loan, or set a shorter term. I'll show you both so you can decide.
When consolidating makes sense
- Your consumer debt is on high-interest cards or a personal loan.
- The repayments are squeezing your cash flow each month.
- You have enough equity in your home to absorb the debt and stay under 80%.
- You're ready to close the cards, not run them back up.
When it might not
If your debts are small or nearly paid off, the refinance costs may outweigh the benefit. And if the spending habit that created the debt is still there, consolidating just clears the decks to fill them again. I'll give you a straight answer either way, because rolling debt into a 30-year loan you don't need isn't doing you a favour.
If the main goal is a sharper rate rather than debt, start with refinancing or the how to refinance guide. You can also model new repayments with the loan repayments calculator.
Want to see the real numbers?
I'll compare your current repayments against a consolidated loan, total cost and all, so there are no surprises.
Frequently asked questions
Will consolidating debt hurt my credit score?
Applying for any loan leaves a mark, but clearing high-interest debts and making one reliable repayment often helps your profile over time. Closing the cards afterwards matters more than the application itself.
Can I consolidate debt if I have limited equity?
It depends how much equity you have. Adding debt lifts your loan to value ratio, and going over 80% can trigger LMI. If you're tight on equity, we'll look at whether the numbers still stack up.
Should I keep the same loan term?
Not necessarily. To avoid paying more interest over the long run, I usually suggest keeping your repayments at the old combined level or setting a shorter term on the consolidated portion. Small change, big difference.
Important information
This information is general in nature and does not take your personal objectives, financial situation, or needs into account. It is not credit assistance or a recommendation to enter into any particular credit contract. Consider whether it is right for you and seek advice before acting. Lending is subject to a lender's eligibility and approval criteria. Terms, conditions, fees, and charges apply.
Greenwood Finance · ABN 23 671 049 693 · Credit Representative No. 551942.
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