Personal Loans

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If you are looking to purchase a big ticket item, such as a car or holiday or if you decide to renovate your home, it is likely you will need a personal loan.

There are thousands of personal loans to choose from, so it is important to understand interest charges, features and the types of loans on offer before making a decision.

InfoChoice can help guide you through this process by enabling you to compare a range of different personal loans including unsecured personal loans, secured personal loans, car loans, overdrafts and debt consolidation loans.

InfoChoice also has personal loan calculators that can give you insight into how much you can borrow.

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The comparison rates are based on a secured loan amount of $150,000 and a term of 25 years. WARNING: These comparison rates apply only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and costs savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. Comparison rates are not calculated for revolving credit products.
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Personal Loans Offers

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“Featured” Products are a form of advertising. InfoChoice may receive a commission, referral, fee, payment or advertising fees from a provider when you click on a link to a product. We may sort or promote the order of these products based on our commercial arrangements. Advertising fees from product providers for product advertisements through emails, sponsored content or placement on the InfoChoice website are based on Cost per Impression, Cost per Click, Cost per Application, Cost per Approved Application, Cost per Lead, Fixed Sponsorship/Advertising fee or a combination.
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For information on how we've selected these "Sponsored" and "Featured" products click here. The comparison rates in this table are based on a loan of $30,000 and a term of 5 years unless otherwise indicated in the product name with^, in which case, the comparison rate is based on a loan of $10,000 and a term of 3 years.The comparison rates are for unsecured personal loans only for the relevant amounts and terms. The comparison rates for car loans and secured personal loans are for secured loans unless indicated otherwise.

WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. Comparison rates are not calculated for revolving credit products.
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What is a personal loan?

A personal loan is a secured or unsecured loan offered by a bank or financial institution that allows you to borrow a lump sum of money that you repay in regular monthly instalments, with interest, over the life of the loan.

Most personal loans last between three to five years and the money you borrow can be used for whatever purpose you like, i.e., a new car, a holiday, debt consolidation, wedding or home improvements.

Generally speaking, you can borrow a minimum of $1000 and a maximum of $50,000, but some lenders have been known to offer up to $100,000.

Borrowers usually receive the amount in one lump sum, once their application has been approved.

Personal loans are usually approved relatively quickly. In most instances, you will know if you have been approved within one to three business days.

Some lenders are able to approve the loan immediately.

How do I apply for a personal loan?

Once you have found an appropriate product from an appropriate lender, you will need to follow these simple application steps:

  1. Application

    When applying for a personal loan, you’ll need to provide proof of income, bank statements and identification. Having all these documents ready at the time of application will help make the process run faster and smoother. If applying for a secured loan, you’ll also need to show details of your security asset.

  2. Assessment

    The lender will look at your documents and financial situation to determine if you can afford to repay the loan.

  3. Credit check

    A credit check is performed by any respectable lender. It is a way for them to assess if you are a risk to them or not. Credit checks show if you have any outstanding debt and how many loans you have recently applied for.

  4. Contract

    Once you have been approved for your loan, you will need to sign a personal loan contract. This contract will confirm all the details of your loan such as how many years your loan is for, the type of loan, and that you have an understanding of the fees involved.

  5. Repayment

    Some personal loans will let you select how often you would like to make your repayments. This could be weekly, fortnightly or monthly repayments.

Advantages and disadvantages of a personal loan

Personal loans are great if you need a quick hit of cash for a large expense. However, like any product there are advantages and disadvantages you should be aware of.

Advantages

  • You can use a personal loan for any purchase. Unlike a mortgage or car loan that is specifically for homes or cars, a personal loan can be used for anything. You can buy a new computer or pay for a holiday. The list is endless.
  • You don’t always need security. As long as you meet the lender’s borrowing criteria, you may be able to get a loan without putting up any security.
  • You can borrow any amount. Most personal loans start at $1000 and go as high as $100,000. Make sure to only borrow what you can afford to pay back.
  • Rates Are Reasonable. The rates for personal loans are much more reasonable than those of credit cards. A lot of people open a personal loan to consolidate their credit card debt so as to save money on the interest.

Disadvantages

  • Fixed Payments. With a personal loan, your repayments will be a fixed amount to ensure that you repay the full balance by the time your term has ended.
  • Interest rates may be higher. Depending on your credit score, you may find that your interest rate might be higher than others. If your credit score is good you will are more likely to get a better rate.
  • You will always pay interest. Unlike credit cards, where if you pay your balance in full each month you can avoid paying interest, a personal loan requires you to pay interest on each monthly repayment.

What is required of you when you apply?

When applying for a personal loan, most lenders will require the following items or information from you:

  • That you are 18 years or older
  • That you are an Australian citizen, permanent resident or have a valid visa
  • That you are employed and receiving regular income
  • That you earn a minimum income
  • That you have a good credit rating
  • You will also need to provide:
  • Proof of identity such as driver’s licence or passport.
  • Proof of employment and income such as payslips and tax returns
  • Details of any other debts or financial commitments
  • Details of additional assets if you are applying for a secured loan.

Different types of personal loans

It is always worthwhile to research what type of loan suits you best, as there are many different types of personal loans available.

1. Fixed interest rates loans

These loans come with a fixed interest rate which means your interest repayments will always stay the same and your rate won’t fluctuate as the standard cash rate does. So not only will your interest repayments not rise, in turn they will also not drop. These loans usually have a slightly higher interest rate than variable loans, but these types of loans are very helpful if you are trying to stick to a strict budget as you will always know what your repayments will be.

2. Variable interest rate loans

If you have a variable interest rate, that means that your monthly repayments may fluctuate with the standard cash rate. Your rate could go up if interest rates spike, but it could also go down if they drop. A lot of Australians choose a variable rate and are willing to take the chance that the rates might go up because they understand the benefits of low interest rates.

3. Secured personal loan

If you have an asset that you are willing to use as security, then a secured personal loan might be your best choice of personal loan. Using an asset such as a car, gives the lender a back-up plan in retrieving their money if you are unable to repay your loan. They are able to sell the asset to recoup the amount you owe to them. Due to the security of your asset, you could be given a secured personal loan with a relatively low interest rate. You may also be able to borrow a larger amount.

4. Unsecured loan

If you don’t have an asset to offer as security you could apply for an unsecured loan. Most lenders consider unsecured loans to be riskier than secured personal loans, and therefore usually charge higher interest rates. However, the bonus of an unsecured loan is it takes less time to apply for the loan, as you don’t have to offer proof of assets. It is also unlikely that you will be offered as large an amount as you would like.

5. Line of credit

A line of credit is similar to a credit card in that you only pay interest on the amount that you use. You can use the money at any point for purchases as long as you repay it. These types of loans are generally for larger amounts than what credit cards provide and they also offer much lower interest rates.

6. Debt consolidation

A personal loan could also be of use to you if you need to consolidate your debt. If you have a credit card or two that are maxed out and you can’t seem to pay them off, or you have some smaller personal loans and debts that you would like to get rid of, consolidating the debts makes a daunting task more achievable. Credit cards have a much higher interest rate than personal loans. The moment you transfer that debt into a lower interest loan, you will find that you will be able to pay down that debt a lot quicker as now the interest repayments are lower. Putting all you debts into one loan also makes managing your finances a lot simpler. Not only will all your debt be subject to the same interest rate, but you will have it all in one place making budgeting more logical.

7. Overdraft

Some loans offer an overdraft. This is great if you are in need of emergency funds. It is an extra amount of approved funds in the account in case you go over the initial amount. You only pay interest on the money that you use. The interest rate might be higher than a regular loan due to this feature.

Comparing personal loans

Each lender will have their own offers and rates. It’s always best to compare as many different types of loans as possible before deciding on which one will work best for you.

The first step in comparing personal loans is to look at the interest rates. Keep in mind, just because a lender offers a lower interest rate, doesn’t mean that this is the best option for you.

You may want to look into each lender’s fees and what features they offer. You may find that the loan with the lower interest rate, doesn’t offer a redraw facility that you may want down the track.

InfoChoice helps you compare over 58 unsecured personal loans, over 63 secured personal loans, over 101 car loans, over 16 overdraft options and over 44 debt consolidation loans.

InfoChoice helps you compare over 58 unsecured personal loans, over 63 secured personal loans, over 101 car loans, over 16 overdraft options and over 44 debt consolidation loans.

Here is a list of loan types and features to consider. This may help you in deciding what is relevant to your situation:

  • Should you get a variable or fixed interest rate?
  • Should you get a secured or unsecured personal loan?
  • How long do you want the loan to go for?
  • Is it likely you will make additional repayments?
  • Will you need a redraw facility?

There are a few extra things you should take into consideration when comparing personal loans such as:

1. Does the loan have a competitive interest rate?

You should always compare the rates of a similar product to ensure you get the best deal. You might receive a rate based on your credit history and your risk rate, if it is a risk based loan. You can usually receive an estimate of what your rate will be before you apply. This shouldn’t affect your credit rating.

2. What fees and charges will there be?

Always take into consideration set up and ongoing fees. If your loan has features such as redraw, you may also be charged fees for the extra features.

3. Is the loan flexible?

Are you able to make extra repayments at no extra charge? Can you increase the amount of times you make deposits? Will there be a penalty if you pay off the loan earlier? Is there a redraw facility if you do make early repayments? These may all be feature you will want.

Paying off my personal loan early

Making extra repayments is a great way to pay off your personal loan earlier.

By paying off a little more than your minimum repayments each month, you could find that you pay your loan off quickly.

The additional repayments will reduce your principal which in turn will reduce your interest repayments in the future.

Keep in mind that not all loans allow you to pay extra without charging you a fee. They may also have an early exit fee if you decide to repay the loan in full before the end date. These fees and charges are usually more common if you have a fixed rate loan.

Can I get a redraw facility with my personal loan?

Some loans allow you to withdraw any extra money that you may have paid into it over the life of your loan. This could come in handy if you have managed to pay quite a bit extra into your loan and then need a lump sum of money for an emergency.

Not all lenders offer this facility and some will charge you if you do redraw. If you think you will need to access extra money, make sure there are no charges.

Refinancing a personal loan?

Refinancing your personal loan is a great way to reduce your repayments or consolidate debts. To refinance your personal loan, follow these steps:

  • Access you current credit score to see if your credit score has recently changed
  • Compare personal loans as you may find a more competitive one
  • Calculate all your refinancing costs such as break fees, application fees etc.
  • Put in an application for the new personal loan
  • Make sure your old loan has been paid off in full

Are personal loans similar to home loans?

Personal loans work in a similar way to home loans in that you borrow a lump sum from a lender and then need to pay it back with interest every month.

However, there are a few major differences.

The first being how long you will have your personal loan for. Most personal loans only last three to five years where as a home loan could go for 25-30 years.

The other major difference is how much you can borrow. With a personal loan, you can generally only borrow up to $50,000 (or $100,000 from some lenders) but with a home loan, you can borrow up to 80% of your home’s value.

Joint personal loans

If you would like to take out a loan with another person you will need to apply for a joint loan.

Note, this is not the kind of loan you take out with a stranger.

Most people usually take one out with a spouse, family member or friend and they are referred to as the co-borrower.

All co-borrowers in a joint personal loan are liable for the debt. This means if a co-borrower can’t pay the debt off, the other will be required to do so.

There are numerous reasons why a joint account would suit you. You may be saving up for a joint holiday or large purchase and both want to contribute. Or you may find that you need a larger amount of money and the lender won’t approve you on your income alone.

Before committing to a joint loan, take the following into consideration:

  • You will both need to meet the loan criteria
  • You will both be equally responsible for the repayments
  • You may be able to receive a higher loan amount with a joint account rather than what you could get on your own.

Always make sure you trust the person who you are about to sign up with. Establish if they have a good repayment history and that they can indeed affords to make the repayments with you.

Applying for a joint loan

Applying for a joint loan is much the same as applying for a regular loan, except you will both need to provide your documents for approval.

Advantages and disadvantages of a joint loan

Advantages

  • Higher chance of approval
  • More chance of a larger loan amount
  • Potential to consolidate larger debt

Disadvantages

  • You will need to rely on the other person’s repayments
  • You may be liable for the whole amount if your co-borrower refuses to pay

Eligibility for personal loans

1. Your income

If you have a low income, you can still be approved for a personal loan but you might need to look at low income personal loans. It’s advisable to check your repayments with a calculator and check the borrowing requirements.

2. Are you a pensioner?

If you are a pensioner, you can still apply for a personal loan but it may need to be a personal loan specifically for pensioners.

3. Do you have bad credit?

If you have bad credit, it is still possible to be approved for a loan. You may also need to apply with a specialist lender if the regular banks won’t approve you. Your interest rate will most likely be higher than a regular personal loan. But the good news is that you can improve your credit history with regular repayments and once it’s improved you can look into refinancing.

4. If you don’t meet the minimum requirements

If you don’t meet the requirements, you may still be able to be approved for a loan with the help of a guarantor. This is someone (usually a parent or family member) who promises to pay the debt back if you are unable to do so.

5. How can I give myself the best chance at being approved?

Being prepared before you apply for a loan will help tremendously. If you know what’s expected of you before you apply, you will find it easier to be approved.

You can prepare your eligibility by knowing the following information before you apply:

  • What is your borrowing capacity?

    What repayments can you afford to make? Write a detailed budget for yourself so you know exactly how much extra money you will have left over to make repayments. It’s important to list everything from your grocery shopping, bills, credit card debts, insurances, entertainment and everything else you may be spending your money on so you have an accurate picture of your finances.

  • What is your credit rating?

    All lenders will check your credit rating before deciding on whether or not they will approve your loan application. You credit rating can be affected if you don’t pay your bills on time, or if you have defaulted on any loans or credit card payments. There will also be a list of applications you have made so it is important to only make one application every six months to keep your credit rating looking good. You can access your credit rating before you apply so you can see what the lenders are seeing when they access it.

  • Do you regularly contribute to a savings account?

    Having a savings account that you contribute to regularly will show the lender that you can manage your finances and will be able to manage an ongoing loan.

How do I figure out how much I can borrow?

There are a few simple things you can do to work out how much you can borrow.

Create a budget

Just because a lender is willing to lend you a substantial amount of money, doesn’t mean you should take that amount. You don’t want to be in a position where you owe more than you can repay. Having a comprehensive budget will help you decide the right amount for you to borrow. You should list all your income and all your expenses. Don’t forget the little things like petrol and take away coffee – it all adds up. Once you have a budget in place, you will be able to see how much you can dedicate to paying off a loan.

Calculate monthly repayments

A personal loan calculator will help you determine exactly how much money you can borrow and the type of borrowing scenario that best first your needs. The InfoChoice Personal Loan Calculator can help you determine how much you can borrow and the associated interest rate.

If you need to borrow a larger amount than you can afford, you can look into a longer-term, loan which will then give you more time to pay it off. Your monthly repayments will be reduced, making it more affordable.

Start comparing

Once you’ve established how much you can afford to borrow, it’s time to get online and compare personal loans. Look for a competitive personal loan rate which offers the right features for your needs.

Personal loan traps to avoid

Eventually you will need to pay back all the money you borrowed. Make sure you don’t fall into any of these traps along the way:

1. Borrowing more than you need

Even though the bank may want to lend you a very large amount, make sure you only borrow what you need. You may end up in a position where you have used up more than you can afford to pay back. Establishing a strong budget before you apply will help you understand how much you can afford to pay back.

2. Spending money on unnecessary items

Sometimes you will notice that you didn’t spend the entire amount the bank has lent you. You can choose to purchase more items or you can choose to play it smart and don’t use that money at all. This will mean you pay off your loan a lot faster and pay less in interest over the life of the loan.

3. Being late with repayments

Being late with repayments is a great way to get a black mark on your credit rating. In order to keep your rating in good condition, try not to miss any payments. If you are the forgetful type, you could schedule direct debits that make automatic payments for you without you having to worry about it. Or you could even schedule reminders in your calendar. Do anything you can to make sure these payments are done on time.

4. Not fully understanding the responsibilities for a joint loan

A joint loan is a great way to access money if you aren’t able to be approved on your own. Applying with another person increases your chances of approval, but can be a disaster if you don’t understand the responsibilities. When you open a joint loan with someone else, you are taking on the full responsibility of repaying that loan particularly if the other person is suddenly unable to make repayments. You want to make sure you trust the person you are opening the loan with. You don’t want to have to pay the entire amount back by yourself. Never open a joint loan with someone you do not know well or someone who has trouble repaying debts.

5. Paying more interest than you need to

Shop around. There are so many lenders out there willing to offer a competitive interest rate. You can research and compare online. Some may have higher interest rates because they offer features that are useful to you. That’s okay if you feel you will benefit from those features, but you need to compare similar products before deciding on which one to apply for.

Will having a personal loan affect my credit rating?

Having a personal loan may negatively affect your credit rating at the beginning of the loan, however with regular on time payments, you should see this improve.

If your credit score was low when you initially opened your personal loan, you may be able to improve your rating over time.

The key is to make sure you do not default on any payments.

If you are able to pay your monthly repayments on or before the due date each month, you will see that your credit rating will slowly improve. It will not happen immediately, but being consistent is key to improving your score.

Of course, you shouldn’t just limit this to your personal loan. Make sure to pay all your bills on time, as this will have an effect on your overall score as well.

How is a personal loan calculated?

When you take out a personal loan, you will need to make repayments until you have paid it off. These repayments are made up of the interest charged and the principal (the amount you borrowed).

Repayments towards the principal will reduce the amount you owe to the lender. The more you reduce this amount, the more you interest will reduce.

Selecting a loan term that is right for you could make the difference between having an affordable loan or one that you are struggling to repay.

You could borrow the same amount of money for a longer period of time and therefore your monthly repayments will be less as they are spread over a larger amount of monthly repayments.

To calculate your repayments, lenders use a calculation where you pay a determined amount each month and at the end of your loan term both the interest and principal will be paid off.

You can use our interest calculator here but if you would like to work it out yourself, here is the formula.

  1. Divide your interest rate by the number of payments you will be making in that year. If you are paying fortnightly then you divide it by 24, or if its monthly divide by 12.
  2. For your first payment multiply that number by the balance of your loan. This gives you the amount of interest you pay for the first month. Each month after that, your balance would have reduced as you have made payments towards it. You can recalculate that number each month with the new balance.

    You can calculate your new balance by following this calculation:

    Principal – (repayment – interest) = new balance

Where can I get a personal loan?

Most money lenders, including banks, specialist lenders and credit unions offer personal loans.

It’s best to shop around to see which one has a product that suits you.

Don’t simply go for the one with the lowest interest rate, as there may be fees charged that you didn’t take into consideration.

Financial Dictionary

Annual Percentage Rate Fees and interest are expressed as a percentage to determine the total charge for the loan. Knowing this which allows you to compare products with different lenders.
Application Fee The cost of arranging and processing a loan application.
Borrower The person who takes out a loan.
Comparison Rate The interest rate, payments and upfront fees and charges (but not all), that make up the total annual cost of the loan.
Credit Rating How credit-worthiness based on credit history is determined by lenders.
Credit Report A report that determines your credit worthiness based on your credit and repayment history.
Creditworthiness How a lender values your ability to repay a loan, usually based on your credit score.
Consolidation Loan A debt consolidation loan helps you consolidate all your debts including credit cards and loans into one place.
Default Failure to meet payment obligations set by a lender.
Extra Repayments Some lenders allow borrowers to make extra repayments into their personal loans. While this helps draw down the loan quicker, it can incur charges
Fixed Rate A locked in interest rate for a specific period of time, usually based on the RBA Cash rate.
Maximum Loan Amount The maximum amount a borrower can borrow.
Minimum Loan Amount: The minimum amount required to be borrowed by the lender.
Personal Loan A personal loan is a secured or unsecured loan offered by a bank or financial institution that allows you to borrow a lump sum of money that you repay in regular monthly instalments, with interest, over the life of the loan.
Principal A loan balance which does not take into account interest.
Redraw A feature of a personal loan, whereby a borrower can withdraw funds already paid into the loan if those funds are in the form of extra repayments.
Secured Loan A loan whereby a borrower secures the funds borrowed with an asset, so the bank has insurance in case the loan is defaulted.
Unsecured Loan No assets are required for security against the loan, leaving the lender more exposed to risk.
Variable Rate A fluctuating interest rate.

FAQs

What can I use a personal loan for?

Personal loans can be used for a number of things. They are a handy way to have access to a bulk amount of money if you don’t have it in savings. You can use your personal loan to consolidate debt, buy a new car, pay school fees, make home improvements, weddings, holidays, the list goes on.

Where can I get a personal loan with bad credit?

If you have missed a few bill and credit card payments and have managed to get yourself a bad credit score, you may find it difficult to be approved for a regular personal loan at a regular bank. However, you may be approved for a personal loan with a specialist lender. Specialist lenders offer bad credit loans, however these are likely to have higher fees and interest rates than regular loans.

Which is the best bank for personal loans?

All four of Australia’s big banks offer personal loans, as do the smaller banks such as online banks, credit unions and mutual banks.

There is no one bank that is considered to be best for personal loans.

Each bank offers their own interest rates and features and it’s up to you to do your research and see which one best suits your needs.

Should I get a fixed or variable personal loan?

A fixed interest rate means you will always pay the same interest each month. This can be very handy for people who need an extra hand with budgeting and money management. A variable interest rate is subject to fluctuations, so if the standard interest rate rises or falls, so too will your interest rates. Many people choose a variable rate in the hopes that the interest rate will drop and they will have lower repayments during that time.

Are there low doc personal loans?

Yes, there are low doc personal loans available. If you are self-employed, you may be able to apply and be approved for a low doc loan. These require less documentation in their application process in comparison to standard personal loans. It’s important to know that even though low doc personal loans may require less documentation, you may need to pay a higher interest rate or provide additional security.

What does my credit score have to do with my personal loan interest rates?

Many lenders use your credit score to determine how much of an interest rate to offer you. If you have a high credit score, you will be seen as a low risk borrower and therefore will probably be offered a lower interest rate. If you have a bad credit score, you may be seen as a higher risk borrower, therefore attracting a higher interest rate due to the chance you might default on payments.

Can I improve my credit score?

It’s not too difficult to improve your credit score if you are willing to be a little more disciplined with your finances. Some things that may help are paying loans and bills on time, paying off any loans, closing extra credit cards and reducing your credit card limit. The sooner you start with these steps, the sooner your credit score will start to improve. It isn’t a quick fix. You need a few months of proven discipline before you see any changes.

What documentation is needed for a self-employed personal loan?

Regular personal loans may require you to provide all sorts of documentation such as proof of identity, proof of residence, details of any other outstanding loans, details of any assets and proof of income. Self-employed borrowers won’t have payslips and group certificates to prove their income, so they may need to provide tax returns and bank statements to prove they will be able to afford the loan.

What is an Overdraft?

An overdraft is an extra amount of funds available to you once your account reaches zero. It allows you to continue withdrawing money even when the account is empty. You will be charged interest on the overdraft.

How quickly can I get the money from my personal loan?

If you are applying for a personal loan with your current bank, you may be able to receive your funds the same day as your loan is approved. If you are applying for a loan with a new lender, it might take around three business days for the money to be available.

What is the average interest rate on a personal loan?

The average interest rate depends on the type of loan you’re applying for. An unsecured loan has an average interest rate of 12-14% p.a., while a secured personal loan has an interest rate of 8-12% p.a.

What if I fail to repay a secured personal loan?

When you open up a secured loan, you put up some security that the bank will use in the case that you won’t be able to repay your loan. If you fail to repay your secured loan, the lender can sell your security to recoup the cost of what you owe them.

What do I do if I'm having trouble repaying my loan?

The first step you should take if you are struggling to repay your loan is to contact your lender. They may be able to put you on a payment plan, or offer you options to help you manage your repayments. There’s also the option of contacting the National Debt Helpline for free financial counselling on 1800 007 007 to help you organise a budget.

Can I buy a car with a personal loan?

Yes, you can buy a car with a personal loan. If you need a secured loan you could use the car as security to make sure you get approved. Just keep in mind that if you can’t repay the loan the lender could sell the car in order to get their money back.

How much should I borrow?

You should ever only borrow what you need. Borrowing too much could put you in a position of not being able to repay the loan.

What is loan protection insurance and do I need it?

Loan protection insurance is an add-on to your personal loan. If you have this insurance and you end up in a position where you can’t repay the loan, your insurance will pay the minimum repayments. Situations which might occur to make you unable to repay your loan could be that you have lost your job, or cannot work because of illness or injury. This insurance is usually taken out when you first apply for your loan, but you can sometimes apply for it later down the track.

How do I repay a personal loan?

Repaying a personal loan isn’t too difficult. You can usually do this online via internet banking. If you have a loan at the same bank where you have your bank accounts, you can easily transfer money into that account each month. If you are the forgetful type, you could set up direct debit so you don’t need to worry about remembering to make the payment.

Can I get a personal loan if I'm a student?

Yes, you can get a personal loan if you are a student. The lender will take into consideration that as a student you will probably have a lower income than the standard borrower and that you probably won’t have any assets. The lender may be a little stricter with the terms of a student loan and they may only offer a small amount to make sure it is a manageable amount for you to be able to repay

Are pensioners eligible for personal loans?

Yes, pensioners can take out a personal loan. However, it may be a little harder to be approved as without an income from a job, they may deem you unable to make your repayments.

What happens if my personal loan application is rejected?

If your application is rejected, don’t apply for another loan straight away. With each application, you will get a mark against your credit history. This could make it difficult for you to be approved a little later down the track. It’s important to find out why you were rejected. Most times its either because you have a bad credit rating or your income is too low. If you have a bad credit rating, you can rectify that by making sure to pay off any unneeded credit cards and loans, paying bills on time and repaying any loans and credit on time. If you were rejected due to low income, you will need to increase your income in order to be approved next time.

Which personal loan is best?

There is no one personal loan that is best? Each loan has its own benefits and features. You will need to compare these in order to determine what is best for you.

How can I check how much I have owing?

It is generally quite easy to find out your balance. Most times it’s a matter of accessing your online banking. If you would rather not do this online, you could call the bank for a balance or even go into a branch.

Is there a penalty for paying off the personal loan early?

Some lenders may charge an early repayment fee. This could be anywhere from $150 to $800. Check with your bank if one applies to your personal loan.

Who can apply for a personal loan?

As long as you are an Australian resident and are over 18 years old you can apply for a personal loan.

How long will the application process take?

Each lender has a slightly different application process but in most cases you can complete your application online in under 30 minutes. Some lenders can let you know if you have been successful within 60 seconds.

Why does my interest vary month to month?

There are a couple of reasons that your interest will vary each month. One is that it is calculated on the daily balance of the account. Each month you pay off a portion of the principal, therefore the repayments on the next month will be a little different. Secondly, with a variable rate, the interest rate fluctuates with the standard cash rate, meaning your interest will fluctuate with it. Finally, your repayment will be calculated on how many days were in that month, so some months will be higher than others.

I have multiple debts. Can I take out a personal loan to repay these?

Yes, you can take out a personal loan to consolidate your debts. Having all your debts in one place make it easier to manage repayments and your finances.

. I have a joint personal loan. What if my partner can’t pay their portion of the payments?

When you sign up for a joint loan, you both automatically become responsible for the full amount owed. If one of you can’t repay your portion, the other person will need to cover the difference.

Can I open a joint account with someone I hardly know?

You can, but you shouldn’t. Only open a joint account with someone you know well and trust. You don’t want to be left with having to pay the full balance because the other person stopped paying.

Can I apply for a personal loan online?

Yes, most lenders have the option to apply online. This makes it easier than having to go into a branch to do this face to face.

Will the lender do a credit check on me before they approve my loan?

Yes, all responsible lenders will do a credit check to determine whether or not they should approve you. You can easily gain access to your credit score online. It’s always good to find out what your credit score is before applying with any lender.

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Choosing a Personal Loan

If you are looking for a personal loan you have come to the right place, you can compare personal loans from over a hundred lenders – giving you the most comprehensive selection of personal loans on the web to choose from. Whether you are looking for a car loan to buy a new car or personal loan so you can take a well deserved overseas holiday or maybe you would like to just simplify your life with a debt consolidation loan, what ever type of loan you are looking for we have got you covered.

To make finding the right personal loan for you a lot easier we have put together some personal loan comparison lists based on what type of loan you are looking for, such as car loans or debt consolidation loans but if you’re not quite sure what you’re looking for use our personal loan search tool that seeks out personal loans based on your needs, just enter in your details and search. You will get a list of personal loans listed ordered on the lowest monthly repayment which we have calculated for you as a guide so you can quickly and easily see the loan the might be the cheapest for you. Can’t decide on one particular loan? You can do a side by side comparison by selecting the tick box next to each product and hitting the compare selected button. If you are new to the world of personal loans please take the time to visit our personal loan guide section where you will find important tips and information about personal loans to help you better understand what you should be looking for. In the industry check our daily personal loan related daily news, changes in the market or industry related articles you can find them right here in the loans section.

 

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A personal loan can be a big help when you need to make a major purchase – whether it’s to pay for a new car or your dream wedding, make home improvements, or consolidate debt.

If you’re looking for a secured or unsecured personal loan, car loan, overdraft or debt consolidation, we can help you search and compare a wide range of loan offers from different banks and credit unions.

You can also check out our handy personal loan calculators, stay up to date with the latest news, or learn more about your options in our personal loan guides.

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