Declaring bankruptcy in Australia is the last resort for most debtors. This kind of situation arises only when the debtor is completely unable to control his or her debts and cannot agree on a reasonable and suitable arrangement with the creditors. Rather than going in for this option, most people consider debt consolidation of home loans as well as other loans.
This is to ensure that they have only one manageable monthly payment which is at a lower interest rate, making savings of thousands on interest with the possibility of reducing the overall repayment period. All debts pertaining to unsecured personal loans, credit cards and store cards can be consolidated without any issues.
For Australians, debt consolidation loans are based on certain eligibility criteria. Credit records, history of payments, default payments if any and employment are a few factors that are looked at when considering consolidation of loans. At times even refinancing an existing mortgage or home loan would be of great help.
Mortgage refinance make use of the equity available in a person’s property to repay all other high interest debts. It assists in making all current monthly repayments from all debts into one convenient repayment. This would translate in to paying less each month and having more disposable income in hand.
Each person’s financial situation is different and unique and needs to be assessed in detail before taking a decision. For this purpose there are many professional companies who offer sound financial advice as well as debt management solutions.