A debt consolidation home loan allows you pay out your credit card and personal loans under your mortgage. Instead of paying off multiple debts, you pay off all of your debts with one home loan repayment, and a single, lower interest rate.
Debt consolidation through refinancing your mortgage might be the smartest way to get things back under control.
- The major advantages:
- Debt consolidation reduces the effort and cost of maintaining multiple debts, potentially saving you time as well as money.
- Getting rid of lots of small debts by rolling them into one can improve your credit score.1
- By rolling all your debts into one you may be able to get a lower overall interest rate, save on fees and charges, and reduce paperwork.
Sources:
1 https://www.moneysmart.gov.au/borrowing-and-credit/borrowing-basics/credit-scores