Solving your debt fatigue: Debt consolidation loan
Debt consolidation has become a major issue facing Australians. As we increase the limits on our credit cards and take out new lines of credit, the various repayments and even more varying interest rates have become entangled beyond recognition. The costs of living can sometimes catch us by surprise, and with it, so too does debt fatigue.
It’s important to know that the majority of Australians experience debt fatigue. According to the Reserve Bank of Australia, household debt has increased considerably over the past 30 years. And with the pandemic’s subsequent disruption to household incomes, the anxiety of outstanding debt is growing.
Many Australians are unsure of where to find a simple way to consolidate their debts. To find an easy solution to bring various lines of credit into a single loan with a single interest rate.
So how can we consolidate our debts in a manageable way that also reduces the stress on our lives?
Your debt consolidation checklist
Every good financial decision starts with a plan. An outline to map your journey toward financial liberation.
The following are the five guiding principles to planning your debt consolidation.
Before you look to access any form of credit, it is important to know the status of your credit score. The lower the score the higher the interest rate you’ll be offered. Sometimes, possessing too low of a score will result in denial of your application. So, find out what it is and if it is low, try improving your score before applying for a personal loan.
Read our blog on improving your credit score here.
Understand how unsecured loans work
An unsecured loan is simply a loan approved without the need for you to offer existing assets as collateral. Assets to leverage in case of default. Unsecured loans focus instead on your existing income and cash flow to prove repayments can be made on time.
As a result, unsecured loans can be approved and processed incredibly fast. Giving you the convenience of fast turnaround time to pay your debtors and manage a single interest rate and repayment plan.
Balance your current debts against your repayment ability/ income
It’s critical that you consider and understand the extent of your existing debts and how much you need to consolidate.
Knowing the total amount, coupled with projected interest repayments against your income will give you the knowledge to budget accordingly. Giving you the knowledge to stay on top of your debts right through to your final payment.
Seek a preliminary quote to scope how much you can borrow
Using OMM, you can gain access to a quote on how much you will be able to borrow, and the interest rate associated to better know your options. All without negatively affecting your credit score which would occur on a typical credit inquiry.
Pull the trigger and actuate
The most important thing to do is act.
Delaying your decision to consolidate your debts means continued interest payments on your existing accounts and a high risk of falling behind in making your repayments on time. This will harm your credit score and if late payments lead to default, will have a seven-year future impact on borrowing for any provider.
So, the best thing to do is act now.
Preliminary quotes: Scoping your ability to manage your debt
With OMM, we provide preliminary quotes to give you an understanding of what is available to you including the amount you can borrow. Quotes include the set interest rate, repayment amount (Weekly, fortnightly, or monthly), and term period.
The most important aspect of preliminary quotes is so that you can gain foresight without requiring a hard inquiry on your credit score.
If your loan application is denied, here are some ways you can enhance your credit score.
The OMM solution
How a Personal Loan is the Smart Way to Consolidation Your Debts
Managing debt repayments can become a mammoth task to tackle. And, at times can get the better of us. The simple and easy solution to consolidating multiple debts and fixing a single interest rate is a low-rate personal loan.
With awards from Canstar, RateCity, and Mozo for excellent credit personal loans, outstanding value, and expert choice 2021, you have access to one of Australia’s best lenders.
OMM personal loan services are available to Australian permanent residents or citizens over the age of 18-years-old with no reported defaults or bankruptcy.
Access up to $75,000 in funds whilst our entirely online service means your application, submission, and loan management are accessible to you 24/7.
Additionally, you can determine loan period (up to 7 years), weekly, fortnightly, or monthly repayments, putting you in a position to manage your finances.
And, with interest rates on a per annum basis, arrange your repayments to pay within the first 12 months and you gain even more value for money.
