Finding yourself in the deepest ends of hefty debt can be disheartening. The financial strain it comes with is strenuous on your pocket and emotionally draining, too. 

If you owe several lines of debt, then the interest rates alone can drive you insane.

Squashing these mounting debts is not an impossible task. Especially not if you get debt consolidation loans for bad credit in Australia. Stats reveal that one-third of Australians struggle with debts. And, about 40% of GenX in Australia take personal loans to consolidate their debts.

Read along to get a better idea about debt consolidation loans for bad credit in Australia.

What is Debt Consolidation?

The name reveals it all. A debt consolidation practice combines all your debts into one consolidated liability. For example, you are burdened under three lines of credit. You can consolidate these and tie up one monthly payment at a particular interest rate. 

You must wonder, how is this advantageous for your situation? Isn’t it just an added loan? But, no, it does come with a few key benefits. 

Advantages of Debt Consolidation Loan

A debt consolidation loan is quite a financial relief, and here are the reasons why you must consider getting it.

Refreshed Debt Repayment Plan

Regardless of where you get a debt repayment loan, your debilitating debt situation will improve. This consolidated play will have smaller instalments and lower rates of interest. Thus, paying off both the principal and interest becomes more manageable. 

Lower Interest Rate

The biggest reason for adopting a debt consolidation plan is because it comes with decent interest rates. A debt consolidation company can represent you before your creditors and negotiate a lower interest for you. 

Post which, the company will take leverage to restructure your payment plan so you can successfully write off your debt.

Eliminates Extra Fees

You may find yourself in trouble with added penalty fees when you default on loan repayment. This only worsens your debt situation and adds to the burden. 

However, the company fixes your monthly payment when you get a debt consolidation loan. It reduces any chance of you forgetting to pay different amounts for different loans at other times. 

No Nagging Calls

When dealing with several creditors, the chances are that you would also receive incessant and frightening calls reminding you about your payments. It only adds to the anxiety levels.

When you undertake a debt consolidation plan, you sign a power of attorney in the name of the debt consolidation company. It signals to the creditors that you are taking care of the debt situation.

Improve Credit

If you pay your debts via a regular route, you will likely take years to get done with it. But as soon as you apply for debt consolidation, the agency is committed to helping you become debt-free quickly. 

The payment plans are expediated, and you receive excellent debt counselling service to help you assess and navigate the situation. Your credit score will also bump up when your debt situation slowly improves.

Wrapping Up

A minor financial crisis can create an impactful setback for anyone. Imagine having several loans to repay – it can make anyone so miserable. 

One way out of it is debt consolidation plans or loans. It allows for a more manageable repayment plan while improving your credit score. All the while, you also enjoy a lower interest rate with no additional fees.

Consider looking into a debt consolidation plan now.