Australians look to reduce debt burden

Australians struggling with a range of debt problems should consider refinancing their mortgage, a commentator has said.

Nick Gardner, a finance columnist for News Limited, noted that with interest rates on credit cards currently at 15-20 per cent and personal loans averaging about 10 per cent, Australians can save a significant amount by refinancing such debts on to a mortgage rate of around seven per cent.

The comments – which may interest people looking to compare credit cards and home loans – come after a report by the credit information agency Veda Advantage revealed that 64 per cent of Australians are planning to reduce their credit card debt in the coming six months, with almost half planning to pay the full amount.

In addition, the report found that consumer applications for mortgages fell by 15 per cent in the January to March quarter of 2010, compared to the same period in 2009.

Such debt fears are supported by the latest Consumer Price Index, released by the Australian Bureau of Statistics last week, which revealed that utility bills and healthcare costs have gone up markedly over the last year.

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