Government Debt Consolidation Loans, Are there Any?

Possible government loans in AustraliaAre you buried in debt? Drowning and cannot make your monthly payments? Overwhelmed with too many monthly payments? Have you considered debt consolidation but have heard too many bad things about companies charging exorbitant rates? These are all valid concerns when thinking about debt consolidation and you have to be careful which options you choose.
Essentially, there are no direct government funded debt consolidation loans, there are a few government and non-profit partnerships that provide loans and other low cost responsible lending options.

Reconsider Consolidation Loan
Your first impulse usually is to get a debt consolidation loan because of the attractiveness of a single lower payment. However, in many cases either you do not need to do it, or it in fact is not the best solution.

Budgeting
If many cases people get into financial trouble because of poor money management skills and in other situations it may be an unexpected expense. In these circumstances budgeting can be the answer to climbing out of debt. Taking on new debt to cover old debt really just puts you into more debt (mostly because of extended terms). Consider reducing your monthly expenses by cutting costs and applying savings to the debt. Learn about bill smoothing…it’s a life saver and easy to do.


 
Non-Loan Options
In addition to budgeting, declutter and sell unwanted stuff. Every household has items that can be parted with. With the use of the internet and classifieds, it is simple to sell unwanted or unused items and cash-in. Learn about other ways to get cash without taking on a loan here.

Personal Options
Sometimes the above two tactics won’t be enough. In these situations, if you are able to, you need to try and increase your income. This can include getting a part-time job or try to do some consultant or contract work online. Alternatively, you could ask for extra hours at your current job or ask what you need to do to be considered for a pay increase.

Possible Government Options
If the above tactics still aren’t enough in helping you to gain control of your finances, look for some additional help through the government and non-profits. If you are a low income earner there may be numerous government benefits, grants, free services and low interest or no interest loan options you may be eligible for.

These are financial assistance options to help reduce your monthly outgoings which in turn puts more money in your pocket and the family budget.

Benefits
First if you earn low or no income, whether you are a senior, disabled, a parent, a Carer, a student, an Indigenous Australian or a person seeking employment there are numerous government benefits you may be eligible for to alleviate your budgeting woes. See what you qualify for here.

Grants
For many of these same categories there are a number of one-time payment grants that help out, like housing and telephone allowances as well as tuition and new birth subsidies.

Free Services
One of the most important is to use the free Financial Counsellor provided by the government in most communities that can help you even find the rest of these options, develop a budget, negotiate payment agreements and recommend debt consolidation options.


 
NILS
The government actually has a StepUp and No Interest Loan Scheme (NILS) for low income earners to help them get items they need, or repairs for their home or other necessities. These can again help offset other budgetary needs to help with debts.

The last possible option would be to get a debt consolidation loan from a private company, but its highly recommended you speak to a free financial counsellor first.

This Post Has 3 Comments

  1. Hi. I need to pay off all my debt and fines as soon as possible, but due to bad credit, have been turned away by banks and lenders. I have tried debt agreements but in the long run wasn’t able to afford it. All I need now is a simple loan that I can afford to pay everything off.

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