- Take a hard look at your finances. Ask yourself why you have too much debt and whether you can change your habits and expenditure so that you don't get further into debt.
- Do you need help sorting out a budget and managing your finances rather than just another loan?
- If you think consolidation can work, get quotes from several lenders. Shop around for the best interest rate and lowest fees you can get. The reason for getting a consolidation loan in the first place is to get out of debt, not sign up to a larger one. Talk first to the banks, credit unions or PSIS.
- Use our checklist to work out your total borrowing costs.
- A lender that asks detailed questions about your finances and suggests monitoring of your repayment programme might be doing you a favour.
- Don't include interest-free debts when you're consolidating interest-bearing debts.
More information
- New Zealand Federation of Family Budgeting Services: www.familybudgeting.org.nz
- The New Zealand Association of Credit Unions: www.creditunions.org.nz
- Citizens Advice Bureaux: www.cab.org.nz
- Community Law Centres: www.communitylaw.org.nz
- Insolvency and Trustee Service: www.insolvency.govt.nz
- Commerce Commission: www.comcom.govt.nz
- Ministry of Consumer affairs: www.consumeraffairs.govt.nz
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