Debt Consolidation Loans Through Yes Loans
Refinancing loans in Australia for cars, motorcycles, boats, trucks and credit cards
If you have several loans and the interest rate starts to rise, you may need to start thinking about combining them together in order to save money. You could combine your personal loans, credit cards, car loans and other debts into a low rate loan secured against your home. This can be known as a debt consolidation loan and at Yes Loans, we specialise in finding debt consolidation loans in Perth.
It is also possible to consolidate your debts into an unsecured loan if you don’t have property security. There are different loan products available depending on your circumstances.
Some of the reasons to consider debt consolidation;
Most credit cards have high annual percentage rates,
It's simpler to only have one repayment to think about instead of several,
Short-term loans can be costly because they are unsecured,
- You can repay over a short-term (up to 7 years)
Some people use their property to consolidate their debts, but sometimes this may not be the best option. Home Loans are usually based on a term of 20 to 30 years. An example of the difference is a $30,000 car loan, taken over five years with an interest rate of 10%. The interest content of the loan would be at $8,244.68. New or used car loan.
At first glance this seems a great idea as home loan rates average at 7%. If you borrowed this money on your mortgage over 25 years at the rate of 7%, then the total interest over the term of the loan would be a huge $33,610.13 - that's a difference of $25,365.45.
The banks are happy to lend against the security of the family home.
An important fact to bear in mind when thinking about a long-term loan is that most consumer goods (cars, boats, plasma TV lounge suites) depreciate in value, so it makes sense to match the loan term to the expected life of the goods.
The examples used in this article relate to new car loans and used car loans. The home mortgage relates to housing loans and mortgages in Australia.
Debt consolidation relates to using a housing loan and does not refer to bad credit loans and debt agreements. It is recommended that you seek independent financial advice when considering debt consolidation in Perth.
If you would like to speak to a Yes Loans professional about debt consolidation loans, contact us online or just call us on 08 9472 3000.