If time is of the essence and you need a quick injection of cash sooner rather than later, you might consider opting for a fast approval personal loan. These loans are structured in a similar fashion to standard personal loans, however applications are processed at a greater rate meaning, as the name suggests, you can potentially receive funds 'fast'.
How do fast approval personal loans work?
Fast approval personal loans, also known as instant cash loans, are a smaller type of personal loan generally tailored to amounts between $500 to $5,000.
Fast approval will generally mean you will receive funds pending your application within the day if applied and approved during business hours. In some cases, these loans can be approved in a matter of hours, which is a far cry from waiting days for approval for a standard personal loan or credit card.
These loans usually have shorter terms than a standard personal loan, typically ranging from a minimum of three months up to 24 months. Some have terms shorter than 62 days, and these are typically called 'payday loans'.
Keep in mind it's important to reconsider your need for payday lender loans, as the interest rates and fees associated with these products can be very high, in some cases in excess of 48% p.a. depending on factors such as your credit profile. Some also charge myriad fees, making that seemingly innocent $500 loan quickly blow out to well beyond that figure.
How can you increase your chances of fast loan approval?
The best way to securing fast turnaround on your personal loan is to make sure that you fit all of the eligibility criteria. Lenders have specific criteria for a number of product offerings, therefore its important to check beforehand as to avoid any unnecessary hiccups.
These requirements will typically include:
- Aged 18 or over.
- Are an Australian citizen or have permanent residency in Australia.
- Are in steady employment earning sufficient income to satisfy loan repayments.
- Have 100 points of identification - birth certificate, passport or Medicare card.
- Personal details including address, valid email, mobile phone number and bank account details.
- Have a reasonable to good credit rating.
- Have no records of bankruptcy or insolvency.
You will also be required to provide at least the last three months' worth of pay slips to prove your income, as well as bank statements to allow the lender to see how responsible you are in managing your cash inflows and outflows.
Tips for a successful loan application
Before commencing your fast personal loan application, check your credit profile through one of Australia's three credit reporting agencies - Experian, Equifax, illion - to determine if there are any hurdles that may prevent you from receiving a loan. Very few providers offer personal loans without checking credit history, given the checks protect both the lender and yourself from taking on too much debt.
Importantly, the more applications you make, the more hits will be made to your credit profile which can potentially tarnish your overall credit rating. You should only apply to providers that you fit the criteria for and for amounts that do not exceed your means, otherwise you'll be rejected outright.
Comparing fast personal loans
If you are in the market for a fast personal loan, consider asking yourself the following questions before choosing which lender to apply with.
How much can you comfortably borrow?
Most fast personal loans don't go over $5,000, which means if the amount you require is more than this, you may elect to opt for a standard personal loan. Generally the greater the amount borrowed, the more interest is required to be paid over the life of the loan. To help calculate how much you may be able to borrow and repay with a fast personal loan, check out InfoChoice's Personal Loan Calculator.
How long do you need to pay the loan back?
Fast personal loans will typically range in loan term length from a couple of months up to five years, with larger loans needing a seven-year term. Typically the shorter the loan term, the less interest you'll pay, but the higher your repayments.
Many lenders will impose early repayment penalty fees to meet the interest expense lost for paying off a loan early, therefore this should be factored into calculations when searching for a fast personal loan lender that charges no early repayment fees.
How quickly will you receive the funds?
Fast means different things to different people. You may need the money within an hour or two, or you might be OK to wait for two days or more. The turnaround time is an important factor in your choice.
How quickly will the loan be funded? Since you're looking for a fast loan, this is an important aspect to compare. While some lenders give you access to funds within an hour, most will take 24 or 48 hours.
How much will the loan cost?
There's the interest loan to take into account, of course, as well as any establishment fees and ongoing fees or costs. These additional fees affect the overall cost of the loan and lenders have their own fee schedules, so make sure you assess the comparison rates when conducting your research.
A word or two of caution
Don't be fooled by an attractive interest rate or low set-up fees, as these products may be hiding high fees or a higher-than-necessary interest rate in the fine print. If you find that you can pay off the remaining balance of your loan earlier than scheduled, make sure you keep figures on hand as an early repayment penalty could cancel out the savings you make on the interest.
Compare personal loans from Australia's banks, credit unions and other lenders at InfoChoice.