Debt Tip

Debt & Credit Tips

Insider tips from ex-debt collectors and credit managers

Debt Tip 1: How Australians Can Manage Mortgage Rate Spikes

A practical guide for homeowners facing rising interest rates.

Insider tips on how Australians can manage mortgage rate spikes:
If your repayments are climbing, these steps can help you stay ahead and cut costs:

  1. Shop the market for a better rate. Compare lenders (or ask a broker) and look at the comparison rate and fees, not just the headline rate.
  2. Refinance if you’re eligible. Weigh any break or application fees against the long-term savings. Avoid stretching the loan term unless you have to.
  3. Pay a bit extra, more often. Extra or fortnightly repayments reduce interest and shorten the term. Using an offset can have a similar effect.
  4. Consider fixing part of your loan. A split (part fixed, part variable) can add some certainty. Check lock-in periods and break costs first.
  5. Ask your current lender for a rate review. Loyalty doesn’t always pay—many lenders will sharpen your rate if you ask.
  6. Tidy up the budget. Trimming a few non-essentials and directing the savings to your mortgage adds up quickly.

👉 Remember: Choose the option best for your financial situation. If you’re worried about repayments, contact Credit Reboot for guidance.

Debt Tip 2: How to Manage Credit Default Payments

Defaults can remain on your credit file for 5 years, even after payment.

Paying off a default doesn’t automatically remove it. In most cases, lenders still see you as high risk.

👉 Tip: If you do pay, negotiate removal of the default from your record as part of the settlement.

Debt Tip 3: Mortgage Reduction Strategy

Small changes in repayment schedules can lead to big savings.

Switching mortgage payments from monthly to weekly cuts interest and builds equity faster, often reducing your loan term by over 10 years.

👉 Tip: Even modest extra or weekly payments can significantly reduce long-term costs.

Debt Tip 4: Credit Enquiries Affect Your Score

Each credit application can lower your score.

Every enquiry for a loan or card can drop your score by 50–100 points, approved or not. Multiple enquiries within a short time compound the impact.

👉 Tip: Research first, then apply only when confident about approval.

Debt Tip 5: Late Payments Can Affect Your Credit Score

Even short delays can leave a lasting impact.

Being just 14 days late can lower your score by 50–100 points and remain for 2 years.

👉 Tip: Set reminders or direct debits to ensure payments are never late.

Debt Tip 6: Mortgage Arrears and Late Payments

Banks may use your own savings to cover arrears.

If you fall more than 60 days behind, banks may draw from your offset or savings accounts to cover missed payments — sometimes without notice.

👉 Tip: Avoid holding large savings in the same bank as your mortgage if you are behind on repayments.

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