Running a business often means juggling more than one type of debt at once: a business loan, an equipment finance facility, a credit card, an overdraft, maybe an ATO payment plan. We roll these separate debts into a single facility, with one repayment, one interest rate and one lender to deal with.
In simple terms, business debt consolidation means refinancing several existing business debts into one new facility. Instead of five different repayments going out on five different days, you make one repayment. The new facility might be secured against commercial property, business assets or a director’s residential property, depending on what you have available and what the lender needs to see.
The goal is usually to simplify cash flow and, where possible, bring the overall cost of the debt down. It is not always about a lower rate on every debt. Sometimes it is about buying breathing room by stretching repayments over a longer term, so the business has more cash available each month to trade with.
Consolidation tends to make the most sense when a business has taken on debt gradually, often in response to different problems as they came up, rather than as part of one plan.
An ATO debt or payment plan sitting alongside other business borrowing, making the total repayment load hard to see clearly.
Several pieces of equipment finance taken out at different times, each with its own repayment date and rate.
A mix of business credit cards, overdrafts and short-term lender advances taken out to plug different gaps.
Trade finance or supplier debt that has built up during a slow trading period and is now due.
Repayments that are squeezing cash flow, even though the business is still trading normally day to day.
If any of this sounds familiar, it is worth reviewing the numbers before the situation gets harder to manage. Earlier action usually means more options.
Consolidating business debt is not something to do without seeing the full picture first, and that is where a broker earns their keep.
We go through every debt you are carrying: the balances, the rates, the terms and the security behind each one.
We work out what a consolidated facility should look like, what security it would need and what the realistic outcome is: lower repayments, a longer term, or both.
With access to over 60 lenders, we present your situation to the ones most likely to approve it on workable terms, rather than a single bank’s one-size-fits-all policy.
We manage the paperwork, liaise with the lender and coordinate discharge of the existing debts once the new facility settles.
Every lender assesses a consolidation a little differently, but most are working through the same core questions.
Current and projected cash flow, including any seasonality in how the business trades.
The total level of existing debt across the business and what it is currently secured against.
Financial statements, BAS and tax returns that show how the business has actually performed.
Any ATO debt, and whether it is under an active, up to date payment arrangement.
The value and type of security available, whether property, equipment or a general security agreement.
A business with ATO debt or a patchy trading history is not automatically ruled out. It usually means a narrower list of lenders and a stronger explanation, which is exactly what a broker helps put together.
Consolidation is a genuinely useful tool, but it is not automatically the right answer for every business carrying debt.
Before you commit to anything, it is worth seeing what a consolidated repayment could look like based on your current debts.
Our Business Debt Consolidation Calculator gives you a quick estimate of what a consolidated repayment could look like based on your current debts.
Involving multiple lenders, ATO negotiations or a broader restructure? Our Debt Advisory service goes a step further than a straightforward consolidation.
Common questions about business debt consolidation.
Not always, and it depends on the term and rate of the new facility compared with what you are currently paying. Often the monthly outlay comes down because the term is stretched out, even if the interest rate is similar. We will walk you through the actual numbers before you decide.
Yes, this is one of the more common reasons businesses come to us. Lenders will want to understand the ATO debt, whether it is under a payment plan and how it fits into the overall picture, but it does not rule out consolidation.
This varies by lender and by how much is being consolidated. Commercial or residential property, business equipment and a general security agreement over business assets are all commonly used, either alone or in combination.
It depends on the number of existing debts and lenders involved. A straightforward consolidation can move quickly, while one involving several lenders and property security takes longer to settle cleanly.
A formal application will generally involve a credit enquiry with the chosen lender. Part of our job is matching you to the right lender first, rather than submitting multiple applications and leaving several enquiries on your file.
For a standard business debt consolidation, we are paid by the lender at settlement, at no cost to you. If your situation needs deeper strategic work, that would fall under our fee-based Debt Advisory service, and we would discuss this with you upfront.
Every consolidation is different. Book a free consultation and we will look at your specific debts, security and goals before recommending a way forward.
Mortgage & Finance Advisory Pty Ltd, ABN 90 732 203 952, Credit Representative Number 575841, authorised under Connective Credit Services Pty Ltd, Australian Credit Licence 389328.
