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Understanding Debt Consolidation Home Loans in Australia

Your Finance Adviser
Understanding Debt Consolidation Home Loans in Australia

Taking debts from different sources is not a new thing in AustraliaBut over the course of last few years, the number of Australians suffering from financial debts has increased significantly. At present, there will be several people present in the country who would have incurred different types of debts from different places in the form of credit card bills, health bills, vehicle loans, etc. But nowadays, most of these people are found struggling to balance their debt repayments and undergo huge amounts of stress and in worse cases, often opt for further unintentional debt. And to escape from any such situation, it has become completely necessary to search for all the possible solutions that can help in dealing with multiple debt problems. 

Debt consolidation Home loans provide the perfect solution in dealing with multiple debt problems. This type of home loan helps in bringing together all types of existing loans such as credit card, student debt, store card, together into one new debt, which in return helps a person to manage his repayments properly and attain a clear picture of his financial future. The loan amount offered to the person taking debt consolidation home loan is based on the equity that's already in their home. 

Importance of debt consolidation home loans 

debt consolidation home loan helps in managing multiple debts since it requires the borrowers to make only one single monthly payment which reduces his debts much faster. Instead of paying at different items of the month on different debts that may have different interest rates, the borrower has to pay the debt at one single interest rate and one single monthly payment.  

This loan is also considered important in regards to the several advantages it provides to a customer. Some of these major advantages include: 

  • Helps in raising cash for home improvements and renovation activities 
  • Offers low interest rate since the loan is secured against the home.  
  • Allows paying and managing multiple debts easily and quickly 
  • Helps in improving the credit rating of the borrower and prevent it from any further damage  
  • Provides a clear financial picture to the borrower outlining as to when he/she will be debt-free. 

Types of debt consolidation loans 

There are two types of debt consolidation loans options offered by lenders in Australia- secured and unsecured debt consolidation loans. Although both of these loans aim to combine multiple debts into a single loan, there is still much difference between how these two works. To get a better understanding, we’ve described here both the different kinds of debt consolidation home loans. 

  • Secured debt consolidation loans: In this type, the loan is secured by a specific asset, usually real estate. Having a property to use as security minimises the lender’s risk of losing money should the borrower stop making repayments. The process of taking out a secured debt consolidation loan is often referred to as mortgage refinancing.  
  • Unsecured debt consolidation loans: Under this type of loan, the lender has no right to repossess a specific asset should the borrower stop making their repayments. This is why the interest rate of unsecured debt consolidation loans is usually higher than secured loans. 

Experts Advice on debt consolidation home loans by Your Finance Advisor   

Your Finance Adviser is one of the most trusted finance advising company that specializes in providing home loan advice, end-to-end lending, financing and wealth management solutions to variety of clients across Australia. We have a team of fully skilled and experiencehome loan brokers that work best as a first-time buyer mortgage broker to keep clients informed about the qualitative home loan.  

Our team will guide you thoroughly about eligibility criteria and features of the debt consolidation home loans and help in finding best solution for you to pay off your debt.  

To get more information, call us on 02 8322 6895 



Your Finance Adviser
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