Jump to content

Consolidate personal loan with homeloan?

  • Please log in to reply
11 replies to this topic

#1 *JAC*

Posted 05 December 2012 - 09:09 PM


After some advice.  We have a personal loan - I think there's about $11k left to pay (over 4 years - nearly finished our first year).  We are currently paying $105 per week, paying at this rate means it will be paid off in just over 2 years.  We are struggling to pay this as we seem to have more outgoing than incoming.

I'm wondering if we should consider consolidating into the mortgage.  I know this isn't the ideal situation, as it means we'll end up paying a lot more in interest over the life of the mortgage, but I don't know if we are going to manage - I feel it's the only thing we can do to give us some reprieve.  Saving that $105 per week and putting into paying something else would really help us.

Would love to hear your ideas / advice.


#2 niggles

Posted 05 December 2012 - 09:14 PM

We did it in that situation. In our case we're making the minimum repayments until I'm back to my usual work schedule next year and then we'll make extra repayments to pay that amount off in the same period we would have otherwise, but with the lower interest rate of the mortgage.

#3 kpingitquiet

Posted 05 December 2012 - 09:19 PM

I'm no expert, but I personally would consolidate it, for sure, as the interest rate is usually much lower on a home loan. Then I'd start paying maybe $25-50/wk extra on the mortgage to help reduce that added amount. This would free up half the money you're paying out now and pay the rest off the 11k at a lower interest rate.

#4 jayskette

Posted 05 December 2012 - 09:23 PM

Yes that in your case, consolidate. As soon as you are financially better, pay MUCH MORE into the mortgage so that eventually the disadvantages of consolidating will dissipate.

#5 Ally'smum

Posted 11 December 2012 - 02:57 PM

I would definitely consolidate to get a lower interest rate, even if you don't pay $105 could you put something towards it?
It wouldn't actually cost you $105 a week as the interest component would be lower.

#6 qak

Posted 11 December 2012 - 03:13 PM

As long as you realise that if you just add it to the mortgage balance and pay it off over 20+ years (or whatever) the interest cost will be much higher.  What interest rate is the PL compared to the mortgage?

#7 CallMeFeral

Posted 11 December 2012 - 03:27 PM

If you can consolidate with your mortgage (presumably lower rate) AND keep up that level of extra repayment (but now directed at your mortgage instead of your personal loan), then it's a great idea, and would save you money in the long run. That's an 'if'. If you just spend the money that would have gone towards that payment, then it will end up costing you.

#8 MrsLexiK

Posted 11 December 2012 - 03:30 PM

It would depend on the interest rate of your personal loan.  We did it for mine when we got our mortgage but it was a 7 year loan (I think I was 2 years into it) with an interest rate more then 10% more then the homeloan we were also getting the loan which was about 50% of the purchase price so our payments were very low to begin with on the loan. I think the rule of thumb is $10K = $100 a month to your mortgage it might be less now because interest rates are good.  

Do a few calcs and see which option has you paying more out in interest.  If you decrease what you are paying now to the minimum it might be you are not that much more disadvanataged. It might be that you end up saving a bundle on interest by adding it to your mortgage.  IT would depend on the interest rates ofthe PL and the mortgage and the amount of the mortgage.

Also you will have to qualify for the increase amount, when we went through this (we added about $10K within the first year of our loan) we had to actually have a whole new loan contract drawn up and payout the original loan.  But this was probably due to not having equity or whatever in the actual loan.

#9 SeaPrincess

Posted 11 December 2012 - 05:35 PM

From your OP, it sounds as if you're paying over the minimum amount.  What would be the impact on your finances if you dropped the payment amount and let it run for the full 4 years?

#10 kboomba

Posted 11 December 2012 - 05:44 PM

Look at getting a 'top up' loan on your mortgage. It will be at your variable interest rate but is treated separately from your mortgage. You pay it separately so you can control how quickly you pay it off, and it would have a redraw facility which you would not need to use if you don't want to. Speak to your bank and see what options you have, and the costs for each option.

#11 *JAC*

Posted 11 December 2012 - 08:33 PM

Thanks so much for your replies.

I think I have decided to suck it up and keep paying it off. I really don't want to pay out even more than I am now, which is what will happen if I pay it off over the life of my mortgage.  We have a small amount of debt (less than 2k) I would like to pay off first, then I think I will concentrate on this loan and pay it down as fast as I can.

ETA - our tight position at the moment is due to extra expenses and Christmas - and not budgeting appropriately.  I know this is short term, so I will continue to plug away at it!

Edited by *JAC*, 11 December 2012 - 08:34 PM.

#12 MrsLexiK

Posted 11 December 2012 - 09:15 PM

You could see if you could consolidate the other loan in a 0% interest credit card? Or a low interest credit card. You have to be disciplined to pay it off in the time they allocate though otherwise you will end up paying high interest.

1 user(s) are reading this topic

0 members, 1 guests, 0 anonymous users


Newborn baby found in a nativity scene

Police are trying to trace a woman who abandoned a baby boy in the manger of a church nativity scene.

Life would be harder without my kids

The Humans of New York Facebook page is well known for sharing touching, real stories from one of the world's biggest cities – and it's just hit the heart of parents everywhere.

Mum dresses as Wonder Woman for last day of chemo

A Brisbane mum dressed up as a superhero to celebrate the end of her chemotherapy and created a moment her family will remember forever.

How a raisin can predict a toddler's IQ

All you need to assess a child's future intelligence is a plastic cup and a raisin, according to new research.

Former Hi-5 member's cannabis hope

Former Hi-5 star Tim Harding hopes a cannabis-derived drug will help control his daughter's epilepsy, which sees the four-year-old suffering between 50 and 100 seizures a day.

The top 5 reasons your toddler throws a tantrum

Whilst to the outside world little people may appear to have it easy, it's actually not always the case – just ask any toddler who's had their toast cut up the wrong way.

Glenn McGrath thought he'd lost his wife and baby

Australian cricket ledged Glen McGrath has spoken about the moment he thought he might lose his wife, Sara and their baby daughter, Madison.


Inside my Centrelink nightmare

Mother Bec Smith has been trying for months to access Centrelink payments. A "serious error" is preventing her.

Warnings over push for hourly childcare billing

Australia's peak childcare body has called for caution around the Turnbull government's push for childcare centres to charge parents by the hour, not by the day.

Cate Blanchett thought about adopting for years

Cate Blanchett says her recent adoption of a baby girl had nothing to do with wanting a daughter after having three sons.

Kate Walsh: 'I can't have kids'

Grey's Anatomy star Kate Walsh has revealed she is unable to have children because she has experienced early menopause.

The parasite that could boost fertility

The Tsimane women of Bolivia are often revered as among the most fertile in the world - on average having 10 children in their lifetimes -- but some are even more fertile than others.

Family may sue cousin over genetics

A Melbourne couple is suing the Royal Children's Hospital for failing to diagnose a genetic disorder in their first child - an error they allege caused them to have another child with severe disabilities.

Strange things mums have done in labour

While most women in labour focus on the upcoming birth of their baby, some women do more interesting things.

Michael Clarke reveals baby's name

When Michael Clarke said he was wrapped around the finger of his little princess, he wasn't joking.

The logistics of breastfeeding twins

Our life is more or less divided into neat four hour parcels of time and it's hard to get much of anything done in the time between feeds.

How to stop people ruining Christmas

We can make a conscious effort about how we react to those curly Christmas day scenarios that can send us up the wall, or should we say chimney.

Lots of formula offers for desperate mum

The mum who was down to her last three tins of baby formula said she had received hundreds of calls and offers to send her formula.

Surviving breast cancer while pregnant

It was last thing Rebecca O'Donnell expected at 30 weeks' pregnant. One morning, while putting on her bra, she felt a pea-sized lump in her right breast.

Cot sheet brands for the nursery

With so many awesome cot sheet options these days, we thought we'd put together a list of go-to brands for you to seek out for your baby's bed.


What's hot on EB

How I survived breast cancer while pregnant

It was last thing Rebecca O'Donnell expected at 30 weeks' pregnant. One morning, while putting on her bra, she felt a pea-sized lump in her right breast.

Grieving father's letter to Bataclan terrorists: "...this little boy will threaten you by being happy and free"

A grieving father whose wife was killed in the attacks on the Bataclan Theatre last weekend has written an open letter to her killers.

5 challenges of motherhood - and how to see them differently

Despite the smiles, the sloppy kisses and the pure magic children bring to our lives, it's hard to deny that motherhood can be tough.

4 challenges of being a new dad - and how to face them

Becoming a parent is challenging – and that applies to both mums and dads.

My battle against antenatal and postnatal depression

I was five months pregnant when I realised I needed help.

Children swapped at birth will not be returned to biological parents

A boy and girl accidentally swapped on the day they were born will stay with the families who have raised them, a South African court has ruled.

A quarter of men believe they get 'man periods'

A British study has revealed one in four men believe they have a monthly cycle.

Baby deposit

How much do you need to save for a 'baby deposit'?

It's fairly straightforward to calculate a house deposit, but how much money do you need to save up for a baby?

Dad's beautiful note to his wife, a nurse

To anyone else it might just look like a picture of a mum having a nap with her toddler.

'I was a complete schmuck': Mike Baird opens up about his wife's postnatal depression

When his wife Kerryn was not well following the birth of their daughter, NSW Premier Mike Baird buried himself in his work.

Mum's desperate plea as whooping cough alert issued

A desperate mother has shared a heart-breaking video of her baby struggling to cope with a coughing fit caused by pertussis.

Coffee could help you live longer

New US research found people who report drinking three to five cups of coffee a day are less likely to die prematurely from heart disease, suicide, diabetes or Parkinson's disease.

The joy and dread of playdates

To live vicariously through your child is to rediscover anxieties you thought dead and buried.

Sick baby could die without scarce special formula, mum says

Lizzie Cann is down to her last three tins of a special formula in short supply.

Adorable toddler's strop foiled by squeaky shoes

We're probably all familiar with the pouty bottom lip and tightly crossed arms of a tot mid-strop.

More sex during World Cup created more baby boys

More sex during South Africa's World Cup meant a disproportionately high number of boys were born nine months later, a new study has found.

Win one of two ABC Shop prize packs in time for Christmas

What a boon it would be to have your toddler's Christmas gifts covered this year. We have two awesome ABC Shop prize packs to give away to two lucky winners.

Do fitness challenges really work?

Fitness challenges aren't new. There's Michelle Bridges 12WBT and a bunch of other programs if you really want to lose weight.

What are pregnant women Googling?

Pregnancy is a huge change for any woman, so it's natural we'll have questions - and turn to Google to ask them.



Can't decide?

Check out the Essential Baby Names section for some inspiration

Essential Baby and Essential Kids is the place to find parenting information and parenting support relating to conception, pregnancy, birth, babies, toddlers, kids, maternity, family budgeting, family travel, nutrition and wellbeing, family entertainment, kids entertainment, tips for the family home, child-friendly recipes and parenting. Try our pregnancy due date calculator to determine your due date, or our ovulation calculator to predict ovulation and your fertile period. Our pregnancy week by week guide shows your baby's stages of development. Access our very active mum's discussion groups in the Essential Baby forums or the Essential Kids forums to talk to mums about conception, pregnancy, birth, babies, toddlers, kids and parenting lifestyle. Essential Baby also offers a baby names database of more than 22,000 baby names, popular baby names, boys' names, girls' names and baby names advice in our baby names forum. Essential Kids features a range of free printable worksheets for kids from preschool years through to primary school years. For the latest baby clothes, maternity clothes, maternity accessories, toddler products, kids toys and kids clothing, breastfeeding and other parenting resources, check out Essential Baby and Essential Kids.