What is a debt consolidation loan?

A debt consolidation loan is a way to combine all your debts – including credit card, personal loans, store cards and more - into one loan so you make just one regular repayment. 

It means you can take a breath and take back some control. It also means no multiple annual fees, and one regular repayment, with one interest rate.

Interested to know what it could look like for you? Check out our debt consolidation calculator. It’s a tool that’ll show you how much your minimum repayments, and monthly interest, can change.

If you’re ready, you can also learn more about our personal loans for debt consolidation.

Why consolidate your debt?

Juggling multiple debts is stressful. By consolidating your debt, you could:

  • manage just one regular repayment
  • have a clear timeframe for when you’ll be debt free
  • Save money, either by having less interest or fewer fees to pay (or both)
  • remove the stress of managing multiple repayments.

Learn more about the benefits of debt consolidation

How does debt consolidation work?

Follow these steps to learn how to consolidate your debt. 

Group your debts

First, sit down and work out how much you owe and what your regular repayments are. This might be a little confronting, but it’s the first step to taking back control of your finances. The number you calculate will give you an idea of how big your debt consolidation loan might need to be.

You can use our budget planner to work out what you can afford to repay. Be realistic with your budget and make sure you’re still able to cover all your regular expenses like groceries, transport and utility bills.

Consolidate your repayments

Staying on top of a single repayment is easier to manage, and you’ll be able to choose a weekly, fortnightly or monthly repayment to fit with your pay cycle. Keep in mind that the length of your loan term will influence how much interest you pay. You can also use our debt consolidation calculator to work out the length of your loan and your estimated repayments.

Debt consolidation could also help you save on administration and account fees. You may also be able to secure a lower overall interest rate for your repayments.

Keep on top of your finances

Now that you’ve consolidated all your repayments into one, you have a clear end date for your loan. This can be a great way to motivate yourself to pay off your debt. 

Use our financial wellbeing resources keep on track and learn more about managing your money. Read about managing your financial health and see our tips for sticking to a budget.

Balance transfer versus debt consolidation

A credit card balance transfer is when you move the money you owe on one credit card to a different card. This allows you to make just one regular repayment on your credit card debt, rather than juggling multiple repayments to multiple providers. A balance transfer usually gives you a special rate on the amount you transfer. Use our balance transfer calculator to help decide if a balance transfer is right for you.

A debt consolidation loan is when you roll multiple debts into one. This could include credit card debt as well as personal loans and other types of unsecured debts.

Want to apply for a personal loan?

Learn about our personal loans for debt consolidation and apply today.

Other ways we can help you

Learn what you can do if you’re experiencing financial difficulty. If you’re a NAB customer, get in touch. We know it can be hard to pick up the phone – you might feel awkward, embarrassed or stressed. But we understand that sometimes things are outside your control, such as illness or suddenly losing your job. We’re here to help.

Visit our financial hardship hub to learn more about how we can help when you’re struggling with your finances. 

Explore other life moments

Related products and services

Get in touch

If you're experiencing a change in your circumstances, require financial hardship assistance, or think you might need help in the future, please contact us.

Request financial hardship assistance

If you’re having trouble making your repayments, you can request assistance.

Call NAB Assist Team

Monday to Friday, 8:00am to 8:00pm (AEST/AEDT)
Saturday, 9:00am to 1:00pm (AEST/AEDT)

1800 701 599

Terms and Conditions