Debt Consolidation › Why can consolidating debt cost more over time?

Why can consolidating debt cost more over time?

Because your mortgage runs for decades. Moving a short term debt onto a long term loan lowers the repayment but can stretch the interest over many more years, so you may pay more in total even though the rate is lower.

Written by Ross McFarlane, Licensed Mortgage Broker (Credit Representative 526725). About the author

Why this matters

A lower interest rate does not automatically mean less interest paid. Time is the other lever. The standard way to avoid the trap is to keep making the same total repayment you were before, so the consolidated debt is cleared in a similar timeframe, not dragged out to the full mortgage term. That captures the saving without the long term cost.

The key points

A mortgage runs for decades, stretching the interest.
Lower rate does not always mean less total interest.
Keep your repayment level to clear it faster.
That avoids the long term cost.

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Last reviewed: June 2026

General information only. This page provides general information about home loans and is not financial or credit advice, a quote, or a guarantee, and your personal circumstances have not been considered. Lending policies, interest rates, fees and eligibility vary by lender and change over time. Always confirm your own situation with a licensed mortgage broker or lender before acting. Ross McFarlane (Credit Representative 526725) is an authorised Credit Representative of Australian Associated Advisers Pty Ltd t/a Keylend, Australian Credit Licence 392169.