Mortgage Life can also help with debt consolidation if you are struggling with your debt repayments. It may be something worth considering if you need assistance managing several repayments and getting a clearer picture of your finances.
What is debt consolidation?
- It helps to bring all your existing debts (for example: credit cards or loans) together into one new debt by taking out a personal loan to repay/pay out your existing debts and this will leave you to payback one new loan over a new set loan term.
- For example, if you have two or three different credit cards with debts of, $2,000, $3,500 and $7,000, you’re likely to have different interest rates for each card and be making different repayments amounts at different times of the month for each card.
- For many people, this can feel rather overwhelming and can complicate their ability to manage their cash flow.
Why is debt consolidation a positive thing?
- It gives you the option to take out a single loan to pay off each credit card or loan and any outstanding interest. This can give you one repayment per week, fortnight or month (usually you get to choose your own repayments).
- The interest rate may be lower than your credit card or existing loans interest rates and this can help in reducing your overall debt
- Your repayments may become easier to manage because the number of repayments will be reduced per month
- If you are paying out credit cards with debt consolidation, it can assist with your budgeting. Your “minimum repayments” for your credit cards will no longer exist, and you can focus on the end date of your new personal loan and repaying the loan repayments instead.