Can I Include My Student Debt in a Debt Consolidation Loan?

We explore if you can include your student debt in a debt consolidation loan.

Please note that Unloan does not offer debt consolidation loans.

You’ve got a student loan and considering adding this into a debt consolidation loan to help you manage your financial situation, and wondering if this is possible.

No, you can’t include this as part of a debt consolidation loan. However, you may want to consider taking cash out to pay it off – this is called cash-out refinancing. This involves converting an unsecured debt such as a student loan into a secured debt such as a mortgage where you are taking out additional cash against the equity of your home to pay off your student loan separately.

Unlike a debt consolidation loan where you are combining multiple debts into one, the lender must assume the original debt (in this case, the student loan) is not actually being consolidated or closed as they are only providing you with cash. This can make it more difficult to meet your lender’s serviceability criteria.

It's important to note that by performing cash-out refinancing, you may end up paying more interest over the life of the loan, particularly if the loan term is longer than that of the original debt. For more details on pros and cons in cash-out refinancing, check out our blog here.

This article is intended to provide general information only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. Please consider seeking financial advice before making any decision based on this information.‍

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