Debt consolidation · For homeowners One repayment, at a pace you choose
Juggling several debts on top of the mortgage? I put every debt on one page and show you each way to restructure it, with the true cost of each. Then you choose the pace.
Key takeaways
- Rolling debts into your home loan can turn seven repayments into one, and lower the monthly amount.
- A lower repayment over a longer term usually costs more in total. On $50,000, the 25-year pace costs about $60,751 in interest, and keeping your current repayment about $6,516.
- Consolidated debt is secured against your home, and it only works if the old cards stay closed.
- Built for homeowners with equity. If you rent, or owe less than about $20,000 outside the mortgage, it’s usually not the answer.
An example month, not counting the mortgage
- 1stCar loan$560
- 4thCredit card$180
- 7thAfterpay$86
- 9thPersonal loan$398
- 12thSecond credit card$120
- 15thStore card$52
- 22ndZip$47
Rolled into the home loan: one repayment, on a day you pick. Illustrative.
You’re not bad with money. The debts just stacked up
A card for an emergency. A personal loan when the car died. Afterpay at the checkout. Each one made sense on the day.
Nobody ever put them on one page. That’s where I start: every debt, every rate and what it really costs you, before I talk to a single lender.
This is for you if
- You own your home and have built up some equity.
- You have three or more repayments outside the mortgage, around $20,000 or more in total.
- Your household has a steady income.
- A bank has said no, or you haven’t asked because you expect a no.
This isn’t for you if
- You rent or don’t own property.
- You’re after a debt agreement or bankruptcy advice. The National Debt Helpline is free: 1800 007 007.
- You owe less than about $20,000 outside the mortgage, where fees can outweigh the benefit.
- You want a yes promised before anyone has looked at your file.
Same debt. Three paces. See the trade-off before you choose
A lower repayment over a longer term usually costs more in total. Here’s the same debt three ways, with the total interest on each. Change the figures to match yours.
Today
Where you are now
$1,443 a month
- Cleared in
- 4 yrs
- Total interest
- $19,247
Pace 1 · breathing room
Lowest repayment, over 25 years
$369 a month
- Cleared in
- 25 yrs
- Total interest
- $60,751
Pace 2 · middle
Halfway between the two
$910 a month
- Cleared in
- 5 yrs 8 mths
- Total interest
- $11,424
Pace 3 · clear it
Keep paying what you pay now
$1,443 a month
- Cleared in
- 3 yrs 4 mths
- Total interest
- $6,516
Illustrative calculation only, not a quote, an offer, a comparison rate or a client result. “Today” assumes your current repayments continue at the average rate shown. Each pace uses the example home loan rate with monthly principal and interest, on the debt portion only. It excludes fees, discharge costs, valuation and government charges, which reduce any benefit. Rolling unsecured debts into a home loan secures them against your home, and a longer term can cost more in total interest.
When consolidating is the wrong move
Read this before you decide. If one of these is you, I’ll say so, and show you the other options.
Stretching it out costs more
A five-year car loan spread over 25 years can mean paying far more interest overall, even at a lower rate. Pace 1 above shows how much.
It moves the debt onto your home
Cards and personal loans aren’t secured. Once they’re in the home loan, your home is the security for them.
It needs a plan to pay it down
If the cards get used again after they’re paid out, you end up with both. It works when the new repayment is set up to clear the debt.
Already been told no? A bank’s no is one lender’s policy
Your bank has one lender on its panel: itself. Some lenders look at the whole picture: your equity, your income and what actually happened.
I match your file to the right lender first, then make one application, not five. Every application shows on your credit file, so the order matters.
Since 1 February 2026, APRA has also limited banks to 20% of new lending at a debt-to-income ratio of six or more, counted separately for home owners and investors. If your debts were close to that line, the bank’s front door got narrower. Other lenders may still look at your file.
Specialist lenders usually charge a higher rate than the big banks. Part of the plan is reviewing the loan every six months, so you can move to a lower rate when your file allows.
Situations I look at
- Late or missed payments
- Defaults, paid or unpaid
- A hardship arrangement
- ATO debt (see home loans with ATO debt)
- Payday loans or buy now, pay later
- Self-employed income
- A recent decline
- Not sure what’s on your file
What it costs
You’ll see every fee in dollars before you decide. Fees are often added to the new loan, which means paying interest on them too, so they’re counted in your numbers.
- Discharge fees from each lender you leave.
- Government fees to discharge and register mortgages, set by your state.
- The new lender’s application, valuation and settlement fees, usually higher with specialist lenders.
- Lenders pay me a commission when a loan settles. You’ll see the amount in writing before you apply. How I’m paid.
FAQ Questions people are nervous to ask
Will this hurt my credit score?
Talking to me doesn’t touch your credit file, and checking your own credit report doesn’t either. A loan application does leave an enquiry, which is why I match you to a lender before anything is lodged, and then lodge once.
My bank already said no. Is there any point?
A bank’s no is one lender’s policy. Different lenders read the same file differently. I can’t promise a yes, but I can tell you which lenders might look at your situation and what they’d need to see.
I have defaults or missed payments. Can I still consolidate?
Possibly. Some lenders still consider homeowners with defaults or late payments, usually at a higher rate than the big banks. A default stays on your credit file for five years whether it’s paid or not, but a paid default reads better to a lender, and every clean month of repayments helps.
Is debt consolidation the same as a debt agreement or bankruptcy?
No. Consolidating into a home loan is a refinance that pays out your other debts. If you’re looking for a debt agreement or bankruptcy advice, the National Debt Helpline on 1800 007 007 is free and independent.
Doesn’t consolidating just move the debt around?
It can, if nothing else changes. That’s why I show the total interest at each pace and suggest closing the cards that get paid out. Consolidating works when the new repayment is set up to clear the debt, not just to shrink the monthly number.
My partner doesn’t know how bad it is. Can I talk to you first?
Yes. The first conversation can be just with you. If the loan would be in both names, you’ll both need to be part of it before anything is lodged.
What will it cost me?
There are usually discharge fees from the lenders you leave, government registration fees, and the new lender’s fees, and sometimes a valuation fee. You’ll see every fee in dollars before you decide, and how much of the benefit each one takes.
Read next
Get your real number in one 30-minute session.
Then set a pace you can live with.
So payday feels like yours again.