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Personal loan values falling but debt consolidation loans rising

Personal loan values falling but debt consolidation loans rising

The number of personal finance commitments fell from October 2018 to November 2018, according to the latest figures from the Australian Bureau of Statistics.

Australian Bureau of Statistics (ABS) figures show that personal finance commitments fell 1.7 per cent in November in seasonally adjusted terms.

It appears Australians are tucking away their wallets and shifting their focus to paying down debt, as the number of debt consolidation loans reached their highest value since August 2016.

In original terms, $796.7 million worth of personal loans were taken out for debt consolidation in November 2018. This was a 2 per cent increase month on month, and a 19 per cent increase year on year.

Further, the number of personal loans that were refinanced also increased. $611.7 million of personal loans were refinanced in November, according to the ABS. This is a 6 per cent increase month on month, and 20 per cent increase year on year.

Unlike debt consolidation personal loans, refinancing peaked in June 2018 at $633.3 million.

November ABS Key Figures

Personal Finance

Oct 2018 ($m)

Nov 2018 ($m)

Oct-Nov ’18 change (%)

Trend Estimates

$5.721m

$5.695m

-0.5%

Seasonally Adjusted Estimates

$5.711m

$5.613m

-1.7%

Source: ABS Lending Finance, Australia, November 2018

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This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.

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