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BUSINESS DEBT

Business debt consolidation

Six repayments across four lenders with an ATO balance underneath is not a problem you can budget your way out of. We refinance the whole stack into one facility with one repayment date.

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A working business with premises, stock and staff — the thing a consolidation is meant to protect.

  • Lender panel

    40+

  • Structure

    Secured or unsecured

  • Debts covered

    ATO, unsecured, cards, arrears

  • Combined experience

    45+ years

Is this you?

If any of these are true, we can help.

Talk it through
  • A business paying four or more separate lenders every month and losing track of which one hits when.
  • An owner carrying a daily or weekly debit facility that takes money out before wages and rent get a look in.
  • A company with an ATO balance sitting alongside unsecured loans taken out to cover it.
  • A director who has personally guaranteed several facilities and wants those guarantees dealt with properly.
  • A trading business with equity in property but no single facility that lets them use it.
  • An accountant with a client whose numbers are fine but whose repayment schedule is not.

How it works

Three moves, in plain words.

  1. 01

    The stack on one page

    Every debt, every balance, every repayment and every rate. Where a payout figure is unclear we ask the lender for it in writing before sizing anything.

  2. 02

    Documents and a position

    Recent BAS, two years of financials where they exist, six months of bank statements, the ATO integrated client account, and details of any security property.

  3. 03

    Structure decided before submission

    We agree what goes in, what stays out and what security is used. Then we choose the lender. In that order, never the reverse.

Put the whole stack on one page

Get the numbers1300 015 267

What business debt consolidation covers

Business debt consolidation means paying out several trading debts with one new facility. Which debts go into it depends on what they cost and what they are doing to your cash flow, not on how old they are or how loudly the lender is calling.

  • ATO balances, including income tax, BAS and GST, and PAYG withholding.
  • Unsecured business loans, including short-term facilities that debit daily or weekly.
  • Business credit cards and overdrafts sitting permanently at their limit.
  • Equipment and vehicle finance in arrears, where the asset is at risk.
  • Trade creditors who have tightened terms or threatened supply.
  • Personal debt the director took on to prop the business up, which is more common than anyone admits.

Not everything belongs in the new loan. A cheap chattel mortgage on an earning asset with two years to run usually stays exactly where it is. We move debt only where moving it improves the position.

The same debts, by their proper names

Chattel mortgage
Finance secured against one identified asset, usually a vehicle or a piece of plant. Where it is cheap and the asset earns, it generally stays exactly where it is.
Merchant cash advance
An advance repaid as a share of card takings or by a fixed daily debit. Priced for speed, and rarely priced for a business that has to live with it for a year.
Revolving facility
A card or overdraft with a limit that refills as it is repaid. Lenders assess the limit as the exposure, not the balance sitting on it today.
Personal guarantee
A director’s personal promise to repay a company debt. It outlives the company, and it is released only when the facility behind it is paid out and the lender confirms the release.
Director loan
Money a director has put into the business from their own resources. The quietest debt in the stack, and usually the last one repaid.

The detail

The stack most businesses arrive with

How each layer behaves, and how it is usually treated
Debt typeHow it behavesHow it is usually treated
ATO balanceCompounds daily and escalates through noticesPaid out in full at settlement, direct to the ATO
Daily or weekly debit loanTakes its money before anything else clearsFirst priority. It is usually the reason cash flow is stuck
Credit card or overdraftRevolving. Minimum repayments keep it alive indefinitelyConsolidated, and where sensible the facility is closed
Unsecured business loanFixed term, higher rate, often personally guaranteedConsolidated, with the guarantee released on payout
Equipment finance in arrearsRepossession risk on an asset that earnsArrears cleared, or the asset refinanced separately
Trade creditorsTerms tighten, then supply gets threatenedPaid down where supply is critical to trading
Director loanQuiet, and it is your own moneyUsually left in place and repaid once the business breathes

Writing it out like this is not busywork. Half the value of the first meeting is seeing the whole stack on one page, in order of what it is actually costing, rather than in order of who called last.

An illustrative $300,000 stack, ordered by size

Ordered by size, the tax balance dominates and the daily debit facility looks like a detail. Ordered by what leaves the account before wages on Friday, those two swap places. This chart shows one of those orders, which is exactly why it is never the only one we work from.

Illustrative composition only. Not a quote and not an offer of credit.

View as a table
ComponentAmountShare
ATO balance$120,00040%
Daily debit facility$60,00020%
Unsecured business loan$55,00018%
Cards and overdraft$45,00015%
Equipment finance arrears$20,0007%
Total$300,000100%

Daily debit lenders are usually the first thing to fix

A short-term unsecured business loan that debits every weekday does two things at once. It takes cash out before wages, rent and the BAS get near it, and it is priced for speed rather than for a business that has to live with it for a year.

Read the contract for the total repayment amount rather than the headline daily figure or the factor rate. Divide the total cost of the facility by the money you actually received, then look at the term over which you are paying it. That is the number worth comparing against a consolidated facility.

A daily debit facility

  • Money leaves the account every weekday, ahead of wages, rent and the BAS.
  • Cost is expressed as a factor rate or a daily figure rather than an annual rate.
  • The term is short, so the repayment is large against the amount advanced.
  • Repaying early does not always reduce the total cost of the money.
  • Almost always personally guaranteed by the directors.

One consolidated facility

  • One repayment on one date, which a cash flow forecast can be built around.
  • Interest charged on a reducing balance over an agreed term.
  • An end date, rather than a facility that renews whenever the pressure returns.
  • A payout figure known and agreed before anything is committed.
  • Guarantees on the paid-out facilities released as each one clears.

What actually changes

  • One repayment on one date, which makes a cash flow forecast possible again.
  • A term with an end on it, instead of revolving balances that never reduce.
  • The ATO position brought current, which keeps lodgements, plans and future credit available.
  • Personal guarantees released as facilities are paid out, where the outgoing lender agrees to release them.
  • One relationship to manage, and one broker who knows the whole file.
  • Time. Not a rescue, but room to make the operational changes that fix the underlying problem.
Several separate repayment dates collapsing into a single one the business can plan around.
The list above is what a lender sees. What an owner usually notices first is quieter than any of it: one date to watch instead of six.

What does not change is the business itself. Consolidation buys room. What happens in that room decides whether it worked.

How lenders assess a consolidation

  1. 01Recent trading. Bank statements and BAS carry more weight than a financial statement that closed nine months ago.
  2. 02How the stack built up. A bad debtor, a lost contract or a period of deferred obligations is a story a credit assessor can price. Steady drift is harder.
  3. 03Whether every debt going in is actually being paid out. Part-consolidations leave the lender wondering what else is out there, and they are notably harder to place.
  4. 04Security position, including what property exists, what sits in front of it and what the business owns outright.
  5. 05Director credit conduct, including defaults, arrears and how many enquiries have already been made this year.
  6. 06Serviceability of the new repayment on conservative assumptions, not on the best month of the year.

The structures that get used

Common structures and the trade-off in each
StructureSuitsTrade-off
Refinance against propertyOwners with equity, larger balancesSlowest to arrange, and property is on the line
Unsecured business loanModerate balances, strong recent turnoverShorter term and higher cost than secured lending
Asset refinanceBusinesses owning plant or vehicles outrightReleases cash without touching the home. Limited by asset value and age
Invoice finance alongsideBusinesses whose cash is stuck in debtor termsOngoing facility rather than a one-off fix. Costs sit against margin
Second mortgageWhere a good first mortgage is worth keepingPriced above a first. Consent and a priority deed take time
Private bridgeA deadline that a bank cannot meetHighest cost. Only with a written exit

Often the answer is a combination. A secured facility clears the ATO and the expensive unsecured debt, while an invoice facility deals with the reason the business ran short in the first place.

How it runs

  1. 01

    The stack on one page

    Every debt, every balance, every repayment and every rate. Where a payout figure is unclear we ask the lender for it in writing before sizing anything.

  2. 02

    Documents and a position

    Recent BAS, two years of financials where they exist, six months of bank statements, the ATO integrated client account, and details of any security property.

  3. 03

    Structure decided before submission

    We agree what goes in, what stays out and what security is used. Then we choose the lender. In that order, never the reverse.

  4. 04

    Submission and assessment

    One application, presented with the explanation attached. Valuations ordered early. Conditions answered the same day wherever possible.

  5. 05

    Settlement and payouts

    Each facility is paid direct from the loan proceeds, the ATO included. We check every payout has cleared rather than assuming it has.

  6. 06

    Closing the doors behind you

    Paid-out cards and overdrafts get closed, not left open at zero. Guarantee releases get chased. This is the step that decides whether the stack rebuilds.

Making it stick

A consolidation that gets rebuilt over the following eighteen months has cost you money and equity to arrive back where you started. Three habits prevent that more reliably than anything else.

  • Close what you paid out. A revolving facility left open at zero is an invitation, and lenders treat the limit rather than the balance as the exposure.
  • Run a separate account for BAS and PAYG withholding, funded weekly. Money set aside is money that cannot be spent by accident.
  • Book a review before the next quarter’s obligations, not after. Most of the hard files we see were easy files four months earlier.

Run the numbers

See it with your own figures.

Indicative only. Change anything — the defaults are starting points, not quotes.

What you owe today

Add every balance, not just the loud ones. The four rows below are illustrative starting figures, and every one of them is meant to be overwritten with yours.

  • ATO debt

    Clears in about 3 years 5 months at that repayment.

  • Credit card

    Clears in about 5 years 4 months at that repayment.

  • Equipment loan

    Clears in about 4 years 2 months at that repayment.

  • Business overdraft

    Clears in about 9 years 5 months at that repayment.

Pick the closest type. It only sets the name — you fill in the numbers.

The consolidated loan

A starting assumption only, not a rate we are quoting. Change it to whatever you want to test.

Longer terms cut the monthly repayment and raise the total interest. Move the slider and watch both numbers.

One monthly repayment

$987

$122,500 across 4 debts, consolidated over 20 years.

Repayments today
$3,030
Monthly change
$2,043 lower
Total balance consolidated
$122,500
Weighted average rate now
12.58%
Consolidated rate you entered
7.50%
Current path clears in
9 years 5 months
Consolidated loan clears in
20 years

Each month

What you pay now$3,030
One consolidated repayment$987

Interest, all up

Current path, at today's repayments$48,282
Consolidated, over 20 years$114,344

Lower each month. More in total.

Spreading $122,500 across 20 years brings the repayment down, but it stretches short-term debt over a long term. On these figures you would pay roughly $66,063 more interest over the life of the loan than on your current path.

That can still be the right call when cash flow is the emergency and the alternative is a garnishee or a wind-up. It is not free, and you should hear that from us before you hear it from anyone else. A shorter term, or paying it down hard once the pressure lifts, is how you get the breathing room without the full bill.

Bring these figures to us. We will tell you which of them a lender will actually accept, what it would take to get there, and whether consolidating is the right move at all.

Talk it through with a broker
Assumptions
  • Every rate shown is a figure you typed, including the four illustrative starting rows. Nothing here is a current rate, a comparison rate or a lender's product.
  • The consolidated loan is treated as principal and interest at a fixed rate over the term you chose, with equal monthly repayments and no redraw, offset or repayment holiday.
  • Your current debts are assumed to run at exactly the repayment you entered, at a fixed rate, with no new spending on any card, overdraft or buy-now-pay-later account.
  • Total interest on the current path is the sum of what each debt would cost to clear at today's repayment. Where a repayment does not cover the interest, that balance is counted at interest-only over the consolidated term, so the figure is a floor rather than the true cost.
  • No fees are included: no establishment, valuation, legal, discharge, break or ongoing fees, no lender's mortgage insurance and no broker fee. A real quote includes all of them.
  • Nothing here models an ATO general interest charge remission, a payment plan variation, or the tax treatment of any interest you pay. Those are questions for your registered tax agent.
  • Results are rounded. Interest is calculated monthly, so a lender using daily accrual will land on a slightly different number.

Open the full calculator

Dave Pham, Head Broker at WeL'nd

“Tell me the number. I have almost certainly seen worse.”

Dave Pham · Head Broker

Talk to Dave1300 015 267

FAQ

Questions people actually ask

If yours is not here, ask it. We would rather answer the awkward one early than have you find out later.

1300 015 267
Can I consolidate business debt and ATO debt in the same loan?
Usually, yes. Most lenders that accept a tax debt payout are comfortable clearing other trading debt at the same time, provided everything is disclosed and the total is serviceable. It is generally cleaner than doing two transactions, and it means one settlement instead of two.
Will I need to use property as security?
Not necessarily. Unsecured business lending exists and works well for moderate balances against strong recent turnover, though it is shorter and dearer. Property security brings the price down and the term out. We look at the least drastic structure that clears the stack.
What happens to my personal guarantees?
When a facility is paid out in full, the guarantee attached to it should be released. It is not automatic in every case, so we ask for written confirmation from the outgoing lender. Any new facility will usually require its own guarantee from the directors, and you should read exactly what you are signing.
I have a merchant cash advance or a daily debit loan. Can that be refinanced?
Often, yes, and it is usually the first thing worth clearing because of what the daily debit does to your cash flow. The important step is obtaining a written payout figure with an expiry date, since the payout amount can differ from the balance shown in the portal.
Does consolidating hurt my credit score?
The application itself creates a credit enquiry, and closing older accounts can change the shape of your file. Set against that, replacing several stretched facilities with one that is paid on time usually improves conduct over the following year. What genuinely damages a file is applying to several lenders at once.
My business had a bad year. Will a lender look at recent trading instead?
Many will. Recent BAS, management accounts and bank statements are often given more weight than a financial statement from a period that has clearly passed, particularly where you can explain what changed. Bring both, and bring the explanation.
How much of the debt has to be paid out?
Lenders generally prefer all of it. A part-consolidation that leaves an unknown balance outstanding raises the question of what else exists, and it makes the file harder to approve. If some debt is deliberately staying, say why upfront so it can be presented properly.
Can a sole trader do this?
Yes. The assessment leans more on personal tax returns, BAS and bank statements, and the security is more often residential property. The principle does not change. There is a page on self-employed debt consolidation that goes into how the income assessment differs.
How long does a business consolidation take?
A secured refinance against residential property typically runs a few weeks from complete documents, with valuation as the usual delay. Unsecured facilities can be quicker. Commercial security is slower. We give you a realistic window once we have the file, not before it.
What if consolidating is not the right answer?
Then we say so. If the business is trading at a loss, more debt only funds the loss for longer. Where a company cannot be traded out, a registered liquidator or a small business restructuring practitioner is the right person to see, and seeing them earlier leaves more options open.

Credentials

  • Credit Representative 554029
  • ABN 20 672 801 651
  • FBAA member
  • AFCA external dispute resolution

Related

Other ways we can help

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Where we work

Put the whole stack on one page

Send through the balances and repayments and we will show you what one consolidated facility would look like against what you are paying now. Indicative, and honest about whether it is worth doing.

Or call us

1300 015 267

Monday – Friday, 09:00 to 17:30

Dave Pham, Head Broker at WeL'nd

“Tell me the number. I have almost certainly seen worse.”

Dave Pham · Head Broker

Talk to Dave1300 015 267

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