Business debt consolidation
Compare business debt consolidation options
One facility and one repayment in place of several business debts, for owners juggling multiple lenders.
Business debts only. We do not arrange consolidation of personal or household debts.
Compare my options Call (02) 8310 8516An enquiry is a conversation, not an application. We won't submit anything to a lender without your say-so.
The basics
How does business debt consolidation work?
A lender advances a single facility that pays out your existing business debts. Those balances close, and you owe one lender one repayment instead of several. The new lender assesses your whole position, and security may be required for the sharpest pricing.
The mechanism matters because it explains what consolidation can and cannot do. It does not reduce what you owe; it replaces the terms you owe it on. Whether that saves money depends on whether the new price across the new term costs less than the old prices across their remaining terms. Sometimes it is a large saving; sometimes it is not a saving at all, and a longer term can lower the repayment while the total grows. The point is to look at the total, not just the repayment (section 5 below). What it always buys is one repayment on one day, a cash-flow position you can actually forecast.
What business debts can you consolidate?
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Business loans and short-term advances*
The most common starting point. Several facilities taken at different times, at different prices, often with overlapping repayment days.
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Merchant cash advances*
Frequently the dearest thing a business is carrying, and the most common reason this page gets read. If daily settlements are being taken before you see them, this is the debt to look at first. See the merchant cash advance page for how those are priced.
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Business lines of credit and overdrafts*
A drawn limit is a debt like any other and can generally be paid out. Whether you should close the limit or keep it available is a separate decision worth making deliberately.
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Equipment and vehicle finance*
Possible, and it is more involved than the others: the financier holds an interest in the asset, so the payout has to deal with the asset as well as the balance.
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ATO and BAS arrears*
Often, though it depends on the lender. See the next section.
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Not: personal or household debt*
Personal credit cards, home loans and household debts are consumer credit and cannot be included. We arrange business-purpose finance only.
Can you consolidate ATO and BAS tax debt?
Often, yes. Some lenders will include tax arrears in the balances a consolidation facility pays out, and some will not. It depends on the lender and on your overall position. Structurally it works the same way as any other debt: the facility clears the balance, and you owe the lender instead of the ATO.
That last sentence is the whole structural point, and it is worth sitting with, because it is what most of the pages competing for this search do not say. Consolidating tax debt does not make it go away. It changes who you owe and on what terms. The amount does not shrink. What changes is the contract behind it: a commercial facility with a rate, a term and a schedule, in place of an arrears balance owed to the tax office.
Whether that is an improvement is a real question with a real answer, and it is not one we can answer for you on a web page, because half of it is not a finance question at all.
Here is the honest division of labour.
What we can help with is the finance half: what a consolidation facility would cost you, across its whole term, in dollars. That is arithmetic on numbers we can see, and section 5 sets out exactly how to do it.
What we cannot help with is the tax half: what it costs you to leave the balance where it is. That cost is set by tax law, not by us and not by any lender, and it turns on your own circumstances. That is a question for your accountant and for ato.gov.au, and we will not characterise the answer here. Anyone giving you a confident figure for it on a marketing page is telling you about a rule that may have changed, in a situation that is not yours.
You cannot compare the two halves until you have both. That is the actual advice on this page, and it is why we would rather you spoke to your accountant before you spoke to us than the other way around.
What this means in practice, if you are carrying tax arrears
Get the balance and the arrangement in front of you first. You cannot compare anything without knowing exactly what is owed and what, if anything, you have already agreed with the ATO about it. If an arrangement exists, its terms are part of the comparison, and they are yours to obtain: we cannot see them.
Take your accountant's view on what carrying it costs you. This is the number that decides whether the exercise is worth doing, it is a tax question rather than a finance question, and your accountant already knows your position. We are not being coy: it is genuinely outside what a broker knows about you.
Then the finance half is arithmetic, and we will do it in writing. What a facility would cost over its full term against what the same balance costs you sitting where it is. If it does not improve your position, we will tell you that, and you will have lost nothing but a conversation.
Paying out an arrears balance settles that balance. It does not change anything about future periods, and it is not a substitute for the ongoing obligations that produced the arrears in the first place. If the underlying problem is that the business is not generating enough to meet what it owes as it falls due, a facility that clears the backlog and leaves that unchanged has bought time rather than solved anything. Time is sometimes exactly what is needed. It is worth being clear with yourself about which one you are buying.
And if lodgement itself is behind, start there. A lender assessing your position needs to see it, and so do you. Your accountant is the first call, not us.
Will consolidating actually save you money?
Sometimes substantially, and sometimes not at all. The saving is real when you are replacing dear short-term debt with one sensibly priced facility. It disappears when a longer term quietly turns a lower repayment into a higher total. The only way to know which is yours is to compare the whole cost of both, not the monthly repayment. Here is how.
Compare these lines, in both columns, before you decide anything:
| Cost line | What you are carrying now | What you would carry after |
|---|---|---|
| Number of facilities | Several, each with its own contract | One |
| Interest cost | A different rate on each balance, so your real cost is a blend of all of them | One rate across the whole balance |
| Repayment frequency | Often mixed: monthly, weekly, sometimes daily on card settlements | One repayment on one schedule |
| Term remaining | Whatever is left on each. Short-term debt is nearly finished, which is part of its cost | A new full term, and it is usually longer than what is left on the debts it replaces |
| Fees to get out | Payout figures can include early termination or exit fees on the old facilities. On some structures a fixed fee does not fall away when you repay early | Not applicable |
| Fees to get in | Not applicable | Establishment or application fees on the new facility, and possibly a valuation if it is secured |
| Security | Whatever is already pledged or held under each facility | The new lender's requirement, which may be more than the sum of what is there now |
| The number that decides it | Total dollars still to pay across all facilities, including any exit fees | Total dollars to pay across the new facility's full term, including its fees |
| The number that will mislead you | Your current total monthly outgoings | The new monthly repayment |
Rates, fees, terms and payout figures are set by each lender and vary by lender and by facility. This table is a method for comparing your own numbers. It is not a comparison of any particular offer and it does not describe any outcome you should expect.
Why the repayment falling is not the same as saving money
Because a repayment is a rate and a term. Change the term and the repayment moves without the cost moving at all. Stretch it far enough and the repayment can fall while the total you hand over rises. Both of those things are true at the same time, and only one of them shows up on your bank statement each month.
That is not an argument against consolidating. It is an argument for looking at the right number. A lower repayment has real value if what you need is to survive a quarter, keep staff, or stop daily settlements being taken before you see them. Buying breathing room and paying for it is a legitimate decision. Buying breathing room while believing you saved money is not a decision at all: it is a surprise waiting for you at the end of the term.
The two lines people miss are both fees. What it costs to get out of the old facilities, and what it costs to get into the new one. A payout figure is not the balance you think you owe: it can include exit costs, and on some structures a fixed fee does not reduce just because you are repaying early. Those costs come off the saving, and they come off it before you have saved a cent. We get the payout figures in writing precisely so that this part is not a guess.
And the case where the answer is genuinely no. If your debts are already reasonably priced and reasonably structured, and the problem is simply that there is too much of them for what the business earns, consolidation will not fix that. It will re-shape it, buy time, and cost fees. Sometimes time is what is needed and that is a fair trade made with open eyes. Sometimes the honest answer is that finance is not the tool, and we would rather tell you that than arrange something that makes next year worse. That answer costs us a commission. It is still the answer.
Read more on the benefits of consolidating loans, or send us the list and we will do the arithmetic. If one of the debts is a merchant cash advance, merchant cash advance vs business loan shows how to put its fixed fee beside a loan's interest.
How it works with a broker
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You list what you are carrying.
Every business facility, its balance, its repayment and how often it is taken. Bring the ugly ones. A list that leaves out the dearest facility produces a comparison that is wrong in the direction that hurts you, and we have seen the same three products enough times that nothing on your list will surprise us.
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We get the payout figures.
This is the step that matters and it is why the arithmetic on this page is not a guess. A payout figure is what it would actually cost to close each facility today, which is not always the balance you think you owe: it can include exit costs. We get those figures in writing, from your existing financiers, before we compare anything.
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We compare, honestly.
Total cost of what you are carrying, against total cost of what a consolidation facility would be across its full term. In writing, with the fees on both sides included. If it does not improve your position, that is what the comparison will say, and we will say it.
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You decide, then we arrange it.
If you want to proceed, we take it to the lenders whose appetite fits your position and handle the payouts and the paperwork. Keep meeting your existing repayments until each facility is actually paid out and closed: nothing is settled until it is settled, and a missed payment in the meantime is a real problem on a file that does not need one.
What lenders typically look for
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The full picture, not the good half*
Every facility, including the dearest and the most recent. A lender that finds a facility you did not disclose has learned something about the file that is worse than the facility.
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Servicing after consolidation*
The question is whether the business can meet one consolidated repayment out of trading. That is a different question from whether five separate ones are all being met. Being visibly stretched is the reason you are here, and lenders assessing consolidation know that.
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Recent business bank statements*
Usually supplied directly or through a read-only data feed. On this page they do more work than anywhere else: they show what is actually being drawn, by whom, and how often.
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Security, if you want the sharpest pricing*
Equity in property generally prices a consolidation best, because it is the lowest-risk structure available. It is not required by every lender, and it puts the asset at risk. See the secured business loans page before you offer anything.
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Conduct on the facilities you already have*
Lenders look at how the existing debts have been handled. Missed repayments are a factor and they are assessed differently by different lenders. They are not automatically an answer.
Industries
Industries we help fund
Whatever you do, the finance that fits depends on how your business actually trades. These are some of the industries we arrange funding for, each with its own guide.
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Agriculture & farming
Machinery, utes, inputs bought a season ahead, and repayments that can follow the harvest.
Agriculture finance -
Hospitality & cafés
Fit-outs, commercial kitchen gear, stock before the rush, and the quiet months in between.
Hospitality finance -
Retail & e-commerce
Buying stock before the season sells, fit-outs, and bridging supplier terms against your sales.
Retail finance -
Trades & construction
Tools, vehicles, materials up front, and bridging the gap between doing the work and being paid.
Trades & construction finance -
Health & allied health
Practice fit-outs, clinical equipment, hiring, and opening a second set of rooms.
Health finance -
Professional services
Hiring ahead of billings, office and technology, and bridging project-based invoicing.
Professional services finance -
Transport & logistics
Trucks and trailers, running costs, and carrying the gap between delivery and payment.
Transport & logistics finance
Customer stories
What business owners say about 121 Brokers
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5 out of 5
Cash flow in retail is lumpy, so a line of credit made far more sense for me than a lump-sum loan. I draw down when stock orders are due and pay it back after the season sells through. Having that buffer sitting there has taken so much stress out of running the shop. Only wish I'd set it up years ago.
Priya S. Retail store owner, Sydney NSW -
5 out of 5
My biggest client pays on 60-day terms and it was slowly strangling my payroll. Invoice factoring let me get most of the money up front instead of waiting two months. Now I can pay my contractors on time and take on bigger projects without sweating the gap. It changed how I run the business.
Sophie L. Marketing agency founder, Melbourne VIC -
4 out of 5
A merchant cash advance worked well for me because repayments flex with my daily card takings. Quiet week, I pay less; busy week, I pay more. It suited the ups and downs of a restaurant far better than a fixed loan. Would have given five stars if the initial paperwork had been slightly quicker, but no real complaints.
Ahmed R. Restaurant owner, Perth WA
Testimonials reflect individual customers' experiences. Outcomes vary and depend on the lender and your circumstances.
121 Brokers Pty Ltd (ABN 37 674 323 712) is a finance broker, not a lender. We arrange finance through third-party lenders. Approval, interest rates, fees, timing and the funds themselves are set and provided by the lender, not by 121 Brokers.
FAQs
Debt consolidation questions, answered straight
Will consolidating hurt my credit file?
We cannot promise you either way, and be sceptical of anyone who does. A new application is visible to lenders, and closing several facilities and opening one changes what your file looks like. Whether that reads better or worse depends on the file, the lender and what it is being read for. What is certain is that missed repayments do not help, whatever you do next.
The more useful way to think about it: your credit file is a record of how you have handled credit, and consolidation is a change to what you are handling. A single facility being met on time is a straightforward thing for a future lender to read. Five facilities, two of them dear and one of them behind, is not. But that is a description of a mechanism, not a prediction about your file, and anyone predicting your file has not seen it.
If the file itself is the thing worrying you, the impact of credit scores on business loan approval is worth reading before you apply for anything.
Do I need security to consolidate business debts?
Not always. Some lenders will consolidate business debts without an asset pledged, and some will not. What security changes is the price and the size of what is available: equity in property generally prices a consolidation best because it is the lowest-risk structure a lender can write. It also puts that asset at risk, which is a real decision.
If you have equity and you are considering offering it, read secured business loans first. It sets out what pledging an asset actually buys you and what happens if it goes wrong. That page exists so that this one does not have to make the case in two paragraphs.
Can I consolidate if I have missed repayments?
Possibly. Lenders assess arrears differently from one another, and a consolidation lender is looking at whether your position improves once the old facilities are gone, not only at how the old ones have gone. Missed repayments are a factor, not automatically an answer. We cannot tell you that you will be approved: that is the lender's decision, on its criteria, on your file.
What helps is telling us first. A file we understand before we place it is worth more than a surprise at assessment, because we can approach the lenders whose appetite fits it rather than burning approaches on lenders whose does not. And if repayments are being missed right now, talking to your existing financiers early is worth doing regardless of what happens with us. Early is a conversation about options.
Send us the list. We will do the arithmetic.
Every facility, every balance, every repayment. We will get the payout figures in writing and show you what consolidation would actually cost and actually save, across the whole term. If the answer is that you are better off leaving it alone, that is what the numbers will say and that is what we will tell you.
An enquiry is a conversation, not an application. We won't submit anything to a lender without your say-so.