Debt Consolidation Loans: Compare 50+ Australian Lenders

Most consolidation loans can combine any mix of consumer debt into one facility. Credit card balances are the single most common inclusion, since Australians are currently carrying around $21.6 billion in credit card debt accruing interest, much of it at rates above 20%.

Beyond credit cards, lenders on our panel will typically consolidate personal loans, buy now pay later balances (including overdue accounts with late fees stacking up), medical bills, car or consumer finance, and overdue utility bills before they escalate to disconnection or debt collection.

What generally can't be rolled into a personal debt consolidation loan: a home loan itself (that requires refinancing or a mortgage top-up), business debts, and debts already in a formal insolvency arrangement such as a Part 9 debt agreement.

Consolidation saves money when the new loan's interest rate is meaningfully lower than the blended rate on what you currently owe, and you stop adding new balances to the accounts you've paid off. It doesn't save money by itself; it just changes the structure of the debt.

Credit cards typically charge revolving interest and require only a small minimum repayment (commonly 2% of the balance or $25, whichever is higher), which barely reduces the principal. A personal loan has a fixed term and a fixed repayment that's calculated to fully repay the balance by the end date, which is why the total interest paid is usually lower even before comparing rates.

Take $15,000 spread across two credit cards averaging 20.99%. Paying only the minimum can take years to clear and cost thousands more in interest than the original balance. Consolidated into a personal loan at a materially lower fixed rate over 3 to 4 years, the same $15,000 is repaid on a fixed schedule with a known end date and a known total interest cost. Credit card debt consolidation walks through this comparison in detail, including when a balance transfer card is the cheaper option instead.

An unsecured consolidation loan needs no collateral. It's assessed on your income, credit history and existing commitments, and can usually settle faster than a secured loan. Unsecured loans suit borrowers consolidating smaller amounts who want to avoid putting an asset at risk.

A secured consolidation loan uses an asset, most commonly a car, as collateral. Securing the loan can unlock a larger borrowing limit and a lower rate than an unsecured loan for the same credit profile, but it also means the lender can repossess the asset if you default. Converting unsecured debt like credit cards into a secured loan is worth thinking through carefully: you're putting an asset at risk to pay off debt that previously carried no such risk.

For a full breakdown of both structures alongside balance transfer cards and mortgage top-ups, see the best types of loans for debt consolidation in Australia.

Your rate on a debt consolidation loan depends on your credit score, income, existing commitments and whether the loan is secured. There's no single advertised rate that applies to every applicant; the rate you're offered is priced to your individual profile, which is why comparing multiple lenders in one application matters more than chasing a single advertised headline rate.

Terms typically run from 1 to 7 years. A shorter term increases the monthly repayment but reduces total interest paid. A longer term does the opposite: lower monthly repayments, more interest over the life of the loan. On a $30,000 consolidation loan, moving from a 3-year term to a 7-year term can roughly halve the monthly repayment while roughly doubling the total interest, so it's worth matching the term to what you can actually afford rather than defaulting to the longest option.

Common fees to check before choosing a loan: establishment or application fees (commonly $0 to around $1,000, sometimes charged as a flat fee and sometimes as a percentage of the loan), monthly account-keeping fees ($0 to around $15), and early repayment fees on some loans. A $15 monthly fee sounds small but adds up to $900 over a 5-year loan, so it's worth weighing against the comparison rate rather than the advertised rate alone. For a deeper breakdown of fees and how a personal loan compares to a mortgage top-up for consolidation, see personal loan for debt consolidation: how it works.

Credit cards are consistently the most expensive debt most Australians carry, with an average interest rate around 20.99% and total outstanding balances accruing interest at roughly $21.6 billion nationally. Because card interest compounds daily and minimum repayments barely touch the principal, card debt is often where consolidation delivers the clearest saving.

There are two main paths for consolidating card debt: a personal loan (fixed rate, fixed term, works for any balance) or a balance transfer card (0% introductory rate for a promotional period, typically 12 to 24 months, but the unpaid balance reverts to a high standard rate afterwards). Balance transfers suit smaller balances you're confident you can clear within the promotional window; personal loans suit larger balances or anyone who wants rate certainty for the full repayment period.

Credit card debt consolidation: your options in Australia sets out the full comparison, including what happens to your cards after you consolidate and why closing or limiting them matters.

Having a lower credit score doesn't automatically rule out debt consolidation, but it does change the maths. Specialist lenders on our panel work with impaired credit profiles, though the rate offered will be higher than for a borrower with a clean credit file. The relevant question isn't whether you can get approved, it's whether the rate you're offered is still lower than what you're currently paying across your existing debts.

Lenders assessing a bad-credit application look beyond the credit score itself: recent defaults (paid or unpaid), how much of your available credit you're using, and whether you've applied for credit multiple times recently. Paying off a small overdue default, or reducing a card's credit limit rather than closing it, can improve how you're assessed before you apply.

Debt consolidation loans with bad credit in Australia covers realistic rate expectations, when consolidation still makes sense at a higher rate, and when it doesn't.

A debt consolidation loan isn't the only option, and it isn't always the cheapest one. If you're struggling to meet repayments at all, contacting your lender directly to request a hardship arrangement is worth doing first: lenders are legally required to respond to a hardship notice within 21 days, and hardship arrangements don't involve taking on new debt.

The National Debt Helpline provides free financial counselling, and No Interest Loan Scheme (NILS) loans are available for essential expenses for eligible low-income households. For debt that's become unmanageable, a formal Part 9 debt agreement is a legal alternative to consolidation, though it affects your credit file for longer and has strict income and asset thresholds. Government debt consolidation programs in Australia explains what's actually available through government and non-profit channels, and when a personal loan is still the better path.

If your debt is manageable but you want the cheapest way to clear it, also compare a balance transfer card and a mortgage top-up against a personal loan. Best types of loans for debt consolidation in Australia compares all five structures side by side, including why a mortgage top-up's lower rate can still cost tens of thousands more in total interest once the 25-year term difference is factored in.

Debt consolidation loans are assessed under standard consumer lending criteria. You'll generally need to be 18 or over, an Australian citizen or permanent resident, and earning regular income from employment, self-employment or eligible government payments.

Lenders assess your ability to repay based on your income, existing commitments and the total amount you're looking to consolidate, not just your credit score in isolation. Bank statement health matters: consistent income, manageable spending and no recent history of dishonoured payments all support a stronger application.

Applying takes a few minutes online. We match your application against our lender panel and, where a lender can pay your existing creditors directly at settlement, we'll flag that as part of your matched offer.