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Debt Consolidation to get out of debt with Debt Rescue

Debt Consolidation to avoid financial hardship

Debt Consolidation is a simple yet effective way to reduce your debt and get back on financial track. Financial hardship can disrupt your life in a number of ways. It can cause stress, anxiety and concern about your future, which can have an impact on your relationships, your job and even your health. If you are starting to feel the sting of debt from repayments you can’t afford, it’s time to take action.

When debt stress starts to take hold, there are a number of things you can do to get your money back on track before it gets out of hand. One effective solution is Debt Consolidation. Debt Consolidation is a tried and tested exercise which has helped thousands of Aussies reduce their debts, fees and interest. It has also given them much needed time to get back on top of their finances.

What is Debt Consolidation

Debt Consolidation involves applying for a loan large enough to pay off your existing debts, which will leave you with one regular repayment, one interest rate and one set of fees. Done correctly, a Debt Consolidation loan can reduce your debt by reducing your interest rates and shortening the life of your loans.

For example, say you have two personal loans and a credit card. Each of the lines of credit is charging its own interest and fees. With a debt consolidation loan, you can pay out all your existing debts and only be left with your consolidation loan to repay.

Original Debts

Amount Owing Interest Rate Length of loan Monthly Fees Total Payable Debt
Personal Loan 1 $20,000 13.9% 5 Years $10 $28,269
Personal Loan 2 $5,000 12.8% 3 Years $10 $6,863
Credit Card $6,000 17% 3 Years $0 $7,722
Total $31,000 $42,854

With a Consolidation Loan

Amount Owing Interest Rate Length of loan Monthly Fees Total Payable Debt
Consolidation Loan $31,000 12.6% 3 Years $10 $37,458

In this example, you could potentially save $5,396 by consolidating your debts and repay your debt sooner.

Debt Consolidation to get out of debt

Debt Consolidation is best suited for people who have only just begun to feel the sting of debt. If you haven’t yet defaulted on your repayments, Debt Consolidation is ideal for you. It can help you to look at ways you save money and improve cash flow. However if you have started to miss repayments on your debts, your credit file might be effected which would make it hard for you to get a loan from traditional lenders. It is possible to get a bad credit loan through our affiliate partner Positive Solutions Finance, however, you might not be able to achieve an interest rate which would make it worth your while to consolidate your loans.

If you are struggling with debt, there are debt relief solutions to try before you consider bankruptcy. Some of these solutions include Part 9 Debt Agreements and budgeting and you can read more about these on Our Services Page.

Do Your Research

Debt Consolidation can be a simple yet effective way to reduce your debt and improve your cash-flow. But you should do your research before taking action. Every loan is different, and some banks will charge you for repaying a loan before the agreed period. Sometimes these early breakage fees can outweigh the benefits of entering a Debt Consolidation Loan so be sure to read the fine print of your agreements before making any decisions.  The benefit of debt consolidation is to save on excessive interest and fees so it is a good idea to calculate how much you will save and compare it to how much it will cost you to consolidate your debt.

Refinancing is another option

If you aren’t happy with the interest rates you are getting on your loan, you could consider refinancing your debts. Refinancing a single loan means revisiting your financial institution to discuss better terms of your loan. If your bank isn’t willing to offer you a better deal, you can look to refinance through another lender. Refinancing your loan could reduce your regular repayments and interest, saving you money week to week. If you wanted to refinance several loans at once, you would need to look at a Debt Consolidation Loan.

The Benefits of Debt Consolidation

Debt consolidation results in an immediate reduction of your monthly payments. Consolidating debt means immediate savings in interest rates and it also means you’ll have an easier time managing your debt.

Debt Rescue works with a number of like-minded businesses to offer our clients a full range of debt relief solutions. If you think you would benefit from a debt consolidation loan, we would refer you to Positive Solutions Finance. They can even help you if you have a bad credit rating.

If Debt Consolidation Isn’t Enough

If your creditors are chasing you for repayments, you may need to consider an intensive debt relief program. Debt Rescue is an industry leader in positive debt relief solutions. From budgeting and money management advice to debt agreements and bankruptcy, Debt Rescue can find a positive solution for you.

For more information on debt consolidation, call Debt Rescue today and Talk to an Aussie Who Cares™.

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