Debt consolidation: what to know before you apply

Are you repaying multiple debts? Juggling multiple repayment deadlines and interest rates can take up a lot of time and effort. 
 
One way out of this confusion is debt consolidation. This involves rolling all your debts together into one personal loan, so you make a single repayment each month (instead of several). It often lowers the overall cost of interest and fees, too.   
 
Here’s how to prepare before you apply.  

📱 Check your credit score

Your credit score indicates how reliable you’ve been financially. Missed repayments or defaults can lower your score, making lenders more reluctant to approve your consolidation loan.  
 
View your score for free with MONEYME’s credit score tool in the app. If it’s low, don’t panic; there are steps you can take to improve it. 

💳 List all your current debts

Once you’ve checked your credit score, the next step is rounding up the debts you intend to consolidate. These may include credit card debt, personal loans, payday loans, and buy-now-pay-later debts.  
 
Check how much you would need to pay them off completely. Don’t forget to include any early exit fees your current credit providers might charge.  
 
FYI, MONEYME doesn’t charge any early exit fees on our personal loans, but many other lenders do.  

🗓️ Calculate your monthly repayments

While a debt consolidation loan can save you money, time, and hassle, it’s important to know that you can manage it financially.  
 
With MONEYME, you can get a conditional loan offer for debt consolidation and check your rate and repayments without impacting your credit score. Compare this with your current arrangements to see if consolidation is the right choice for you. 

🙌 Get ready to apply 

Most lenders want to know that you’ll repay your debt consolidation loan reliably, so they need evidence that you’re in a good position to meet deadlines. This usually includes documents demonstrating your income and expenses.  
 
MONEYME’s application process is entirely digital, which means there’s no physical paperwork required. Just have your ID or Australian driver’s licence ready for your identity verification.  

💡 The bottom line

By following these steps, you’ll be better prepared to submit your debt consolidation loan application. You’ll also have a clear idea of how it will benefit you and what it will mean for your financial future.