Aussie spending: Why now’s the time to consolidate your debt
Aussie spending has been turbulent in 2020, with the devastating effects of the bushfires into the outbreak of COVID-19.
In fact, according to Deloitte Access Economics’ latest quarterly Retail Forecasts subscriber report (Q2, 2020), retail spending has been a rollercoaster so far this year.
The report revealed that after the surge in spending growth in the March quarter, Deloitte predicts that it will contract again by 4.0% in the June quarter.
“2020 has been a tumultuous year for retailers. We’re not even halfway through, but across the whole sector we expect calendar 2020 to register a record breaking fall in real retail sales,” Deloitte Access Economics partner and Retail Forecasts principal author David Rumbens said.
“But while the average is dire, there may not be many retailers performing at the average – many will fare much worse, while supermarkets, pharmacies and hardware, amongst others, have been experiencing a golden run.”
Source: ABS Cat 8501.0, Deloitte Economics
It’s no secret that there has been a massive swing in consumers’ ability and willingness to spend. For some it has been a time to cut back and save or pay down debt, while others are splurging more than usual as they shop from home.
“Consumer willingness to spend will likely be buffeted by a number of different factors, meaning that one month’s trading experience may be a terrible guide to how the year as a whole pans out,” Rumbens said.
So, no matter which side of the spender-saver fence you sit on, if you are nestling old or new debt, it may be time for you to bid it farewell with a debt consolidation loan.
How does a debt consolidation loan work?
A debt consolidation loan is a type of personal loan where you can combine a range of different debts and pay them back under one (and in some instances lower) interest rate. This could include credit card debt, store cards, other personal loans or car loans.
Essentially, this loan rolls your debts into one so you only have to remember one loan term, one repayment due date, one repayment amount and one interest rate.
Is a debt consolidation loan right for you?
It all depends on your debts and your personal circumstances. In some cases, this type of loan could end up not only saving you money but also time and hassle as well.
Here are some examples of when a debt consolidation loan may be a good idea:
- You find having multiple repayment due dates confusing
- You have a number of different debts with high interest rates
- You are unsure about which debts you should prioritise
- The benefits of a debt consolidation loan outweighs the disadvantages (for example, a longer loan term doesn’t end up costing you more than paying off your debts separately).
Debt consolidation loans 2020 - last updated 20 May 2022
-
Featured Product Hot Deal A special low rate starting from 5.45% (6.07% comparison rate)
Low Rate Personal Loan
Excellent Credit
interest rate
comparison rate
Monthly repayment5.45% p.a.to 8.48% p.a.6.07% p.a.to 8.84% p.a.based on $30,000
over 5 yearsOurMoneyMarket offer competitive low rates for borrowers with excellent credit on loans up to $75,000, plus free extra repayments and fee-free redraw facility. Winner of Mozo's Experts Choice Unsecured Personal Loan 2021 award^.
Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 5.45% would cost $34,590.57 including fees.
CompareCompare- interest rate
- 5.45% p.a.to 8.48% p.a.
- comparison rate
- 6.07% p.a.to 8.84% p.a.based on $30,000
over 5 years
- interest rate
- 5.45% p.a.to 8.48% p.a.
- comparison rate
- 6.07% p.a.to 8.84% p.a.based on $30,000
over 5 years
- Upfront fee
- $250
- Monthly fee
- $0.00
- Exit fee
- $0.00
- Repayment options
- Weekly, Fortnightly, Monthly
- Early repayment penalty
- $0.00
- Minimum loan amount
- $2,001.00
- Maximum loan amount
- $75,000.00
- Minimum loan term
- 1 Year
- Maximum loan term
- 7 Years
- Security required
- Unsecured
- Other benefits
- Other restrictions
- Rate for Excellent Credit. Establishment fee varies from $250 and is based on your OurMoneyMarket loan grade and total loan amount. The fee is added to the principal amount and paid over the loan term.
Read our Mozo Review to learn more about the OurMoneyMarket Low Rate Personal Loan
-
Home Improvement Loan
Fixed, Unsecured
interest rate
comparison rate
Monthly repayment5.75% p.a.5.96% p.a.based on $30,000
over 5 yearsHandypay offers flexible home improvement loans for Excellent Credit or better. Handypay is a specialist home improvement plan provider and offers loans up to $75,000.
Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 5.75% would cost $34,840.18 including fees.
CompareCompare- interest rate
- 5.75% p.a.
- comparison rate
- 5.96% p.a.based on $30,000
over 5 years
- interest rate
- 5.75% p.a.
- comparison rate
- 5.96% p.a.based on $30,000
over 5 years
- Upfront fee
- $250
- Monthly fee
- $0.00
- Exit fee
- $0.00
- Repayment options
- Weekly, Fortnightly, Monthly
- Early repayment penalty
- 0
- Minimum loan amount
- $2,000.00
- Maximum loan amount
- $75,000.00
- Minimum loan term
- 1 Year
- Maximum loan term
- 7 Years
- Security required
- Unsecured
- Other benefits
- Other restrictions
Read our Mozo Review to learn more about the Handypay Home Improvement Loan
-
Unsecured Personal Loan
Fixed
interest rate
comparison rate
Monthly repayment5.35% p.a.to 19.09% p.a.6.14% p.a.to 19.99% p.a.based on $30,000
over 5 yearsFast, easy and 100% online, this is a low cost loan with no ongoing fees or extra repayment penalties. It's perfect for savvy borrowers with great credit. If you’re over 18 and earn above $30,000, you could qualify (other eligibility criteria may apply).
Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.35% would cost $34,832.61 including fees.
CompareCompare- interest rate
- 5.35% p.a.to 19.09% p.a.
- comparison rate
- 6.14% p.a.to 19.99% p.a.based on $30,000
over 5 years
- interest rate
- 5.35% p.a.to 19.09% p.a.
- comparison rate
- 6.14% p.a.to 19.99% p.a.based on $30,000
over 5 years
- Upfront fee
- $575
- Monthly fee
- $0.00
- Exit fee
- $0.00
- Repayment options
- Weekly, Fortnightly, Monthly
- Early repayment penalty
- $0.00
- Minimum loan amount
- $2,000.00
- Maximum loan amount
- $70,000.00
- Minimum loan term
- 3 Years
- Maximum loan term
- 7 Years
- Security required
- Unsecured
- Other benefits
- Establishment fee is $275 for loans under $5,000.
- Other restrictions
- Establishment fee is added to the loan amount and interest is charged on the total amount.
Read our Mozo Review to learn more about the Harmoney Unsecured Personal Loan
-
Featured Product
Mozo experts choice awards won:
- Unsecured Personal Loan - 2022
Unsecured Personal Loan
Fixed
interest rate
comparison rate
Monthly repayment5.95% p.a.to 19.95% p.a.5.95% p.a.to 19.95% p.a.based on $30,000
over 5 yearsBorrow up to $50,000 unsecured. Perfect if you earn more than $22,100 p.a. and have good to excellent credit. Back to back winner of Mozo’s Experts Choice Unsecured Personal Loan Award, 2021 & 2022^.
Repayment terms from 2 years to 7 years. Representative example: a 5 year $30,000 loan at 5.95% would cost $34,757.21 including fees.
CompareCompare- interest rate
- 5.95% p.a.to 19.95% p.a.
- comparison rate
- 5.95% p.a.to 19.95% p.a.based on $30,000
over 5 years
- interest rate
- 5.95% p.a.to 19.95% p.a.
- comparison rate
- 5.95% p.a.to 19.95% p.a.based on $30,000
over 5 years
- Upfront fee
- $0
- Monthly fee
- $0.00
- Exit fee
- $0.00
- Repayment options
- Weekly, Fortnightly
- Early repayment penalty
- 0
- Minimum loan amount
- $5,000.00
- Maximum loan amount
- $50,000.00
- Minimum loan term
- 2 Years
- Maximum loan term
- 7 Years
- Security required
- Unsecured
- Other benefits
- Other restrictions
- Rates based on borrower with excellent credit score. Maximum 3 year term for loan amounts $8,000 or less.
Read our Mozo Review to learn more about the NOW Finance Unsecured Personal Loan
-
Green Loan
interest rate
comparison rate
Monthly repayment5.79% p.a.6.36% p.a.based on $30,000
over 5 yearsHandypay offer flexible green loans up to $75,000 for Excellent Credit or better. Handypay is a specialist home improvement plan provider.
Repayment terms from 1 year to 10 years. Representative example: a 5 year $30,000 loan at 5.79% would cost $34,873.55 including fees.
CompareCompare- interest rate
- 5.79% p.a.
- comparison rate
- 6.36% p.a.based on $30,000
over 5 years
- interest rate
- 5.79% p.a.
- comparison rate
- 6.36% p.a.based on $30,000
over 5 years
- Upfront fee
- $250
- Monthly fee
- $0.00
- Exit fee
- $0.00
- Repayment options
- Weekly, Fortnightly, Monthly
- Early repayment penalty
- 0
- Minimum loan amount
- $2,001.00
- Maximum loan amount
- $75,000.00
- Minimum loan term
- 1 Year
- Maximum loan term
- 10 Years
- Security required
- Unsecured
- Other benefits
- Can be used for verifiable green initiatives e.g. solar panels, solar battery, solar inverters, solar heating and cooling, rainwater tanks or energy efficient renovations.
- Other restrictions
- Rate for the first 36 months, reverting to a standard offer from 6.29% p.a. (comparison rate 6.80% p.a.) for the remaining term.
Read our Mozo Review to learn more about the Handypay Green Loan
-
Standard Personal Loan
Fixed, Unsecured
interest rate
comparison rate
Monthly repayment7.99% p.a.8.62% p.a.based on $30,000
over 5 yearsHeritage Bank discounted rates for borrowers with excellent credit. Available loans starting from $5,000 to $25,000. Your choice of loan terms up to five years. Extra repayments allowed, but may incur fees.
Repayment terms from 1 year to 7 years. Representative example: a n/a year $0 loan at 7.99% would cost $6,988.90 including fees.
CompareCompare- interest rate
- 7.99% p.a.
- comparison rate
- 8.62% p.a.based on $30,000
over 5 years
- interest rate
- 7.99% p.a.
- comparison rate
- 8.62% p.a.based on $30,000
over 5 years
- Upfront fee
- $200
- Monthly fee
- $5.00
- Exit fee
- $0.00
- Repayment options
- Weekly, Fortnightly, Monthly
- Early repayment penalty
- 0
- Minimum loan amount
- $5,000.00
- Maximum loan amount
- $25,000.00
- Minimum loan term
- 1 Year
- Maximum loan term
- 7 Years
- Security required
- Unsecured
- Other benefits
- Other restrictions
Read our Mozo Review to learn more about the Heritage Bank Standard Personal Loan
On the other hand, if you are already on top of your debt repayments, or have almost paid it down in full, a debt consolidation loan may not be worth it.
Similarly, it’s important to keep in mind that these types of loans are designed to help you pay down your debt. So if a debt consolidation loan is likely to cost you more in interest, it may be a better idea to pay down your debts separately.
RELATED ARTICLE: Where to get a no interest or low interest loan during COVID-19
Need a place to start looking for a debt consolidation loan? Check out the list below or jump over to our personal loan comparison table.
* WARNING: The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.
^See information about the Mozo Experts Choice Personal Loan Awards
Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.
While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.