“Super quick, I got lots of offers. All I had to do was choose which one! I went with Wisr because they were the cheapest. Thanks” - Angela
Written byShaun McGowan
The great thing about personal loans is that they could fund almost anything.
They are perfect when you need that little bit extra, or money now, to cover expenses, start that new project or get you back on track.
You can get a loan between $5000 to $100,000, although the average is around $20,000.
Loan terms can vary between 1 to 7 years, most commonly 3 years.
Other things you need to think about when taking out a loan are:
To get the best personal loan, you'll want to get the lowest rate you can, with no fees and the loan features that are important to you.
According to Society One, the most common reason for not continuing to get a loan is due to price shock. Price shock is when you expect to get the advertised rate, but instead due to your credit profile, you get a bigger rate. Money Matchmaker™ doesn't show you advertised rates, only real rates. So you never get a rate shock.
Personal loans are there to assist you in the short term, not leave you with long term debt.
Lenders will work out your monthly surplus (what you have got left after you have paid all your expenses) to ensure you can meet the repayments.
If you are not able to meet the repayments comfortably, you can try reducing the amount or extending the loan term.
|Personal loan amount||Repayments (8% interest)||Repayments (12.5% interest)||Repayments (16% interest)|
Lenders love boring, or should we say, consistency!
They love it if you've had the same job forever and have been at the same house since you first left home.
Here's an example of how your employment history can influence your approval.
Here is how your credit history can influence your ability to be approved.
You need to shop around and do a true personal loan comparison.
There are lots of lenders who can offer you a loan, based on you meeting their criteria. Many of these new lenders offer rates much better than the banks do for strong credit customers.
You need to compare the interest rates but also most importantly the fees. Look at the total cost of the loan over the term. That'll quickly tell you which one is best from a repayment perspective.
You also need to consider what loan features are important and what fees may arise if you were to pay your loan out early.
Once you have all the information, you'll be able to make a decision on what personal loan works best for you.
|Money Matchmaker™||Direct with Lender||Broker|
|Fees||$0||$0||up to $990|
|Impact Credit Score||No||Yes||No|
|Number of Quotes||Up to 11||1||1-3|
|Time to Quote||60 seconds||1-5 minutes||1-2 days|
|Phone call follow ups||No||Yes||Yes|
|Cost to apply||No||Yes||Yes|
Yes, but you’ll need to provide different documentation to lenders. In general, you will need to provide tax returns in place of employee payslips. Read more about low-doc personal loans.
Approval speeds vary between lenders. In general, banks have the slowest approval speeds, while online lenders can offer same-day (some even offer instant approval) approval.
Yes, but you should consider a specific car loan if the vehicle is less than 7 years old.
This depends on your circumstances and goals.
You can apply for a personal loan in Australia if you are:
The most important factor when gaining approval is to demonstrate your ability to meet the repayment schedule over the term of the loan.
You will need to provide personal identification and financial documents (usually your bank statements or recent payslips), as lenders will need to assess your financial stability and determine if you can service the loan amount.
"Hey I’m Money Matchmaker™, I have a team of wizards making me super smart. I’ve been loaded up with all the information that lenders use, and when you take my quiz, I use your answers to check against all our lenders at once. I’m harmless, I don’t impact your credit score and I’ll show you the best loan matches I can with no brokers fees or annoying ads"
With most personal loan providers, they operate across the country as the process is done 100% online and via the phone. Most are located in the major capital cities like Perth, Sydney, Melbourne, Brisbane, Adelaide and Hobart and often have support staff in smaller towns.
All the lenders we work with all have Australian based teams. So rest assured, when arranging your loan you'll be working with a lender in Australia.
Shaun is the founder of Money.com.au and is determined to help people pay as little as possible for financial products. Through education and building world class technology. Previously Shaun co-founded CarLoans.com.au and Lend.
Information about borrowing rates The rate advertised are comparison rates. See below for further information about comparison rates. Using our lender SocietyOne as an example Tier 1 borrowers will receive an interest rate between 5.95% - 10.49% p.a. (comparison rate 5.95% - 12.83% p.a.). Tier 2 borrowers will receive an interest rate between 9.99% -12.19% p.a. (comparison rate 12.05% - 15.03% p.a.). Tier 3 borrowers will receive an interest rate between 11.99% - 15.99% p.a. (comparison rate 14.37% - 18.62% p.a.). Tier 4 borrowers will receive an interest rate between 14.99% - 19.99% p.a. (comparison rate 18.41% - 21.70% p.a.). The maximum annual percentage rate (APR) interest rate is 19.99% p.a. (comparison rate 21.70% p.a.). An establishment fee applies for most borrowers. Personal loan example: for a borrower with excellent credit (Tier 1 borrower), a loan of $10,000 over a 3 year term, with an interest rate of 8.99% p.a. (comparison rate 12.32% p.a.) and a $495 establishment fee, the fortnightly repayment would be $154 and the total cost over the life of the loan (including the establishment fee) would be $12,013. SocietyOne personal loans are available for terms of 2, 3 and 5 years. Minimum loan term repayment period is 2 years, maximum loan term repayment period is 5 years.
*Information about comparison rates Comparison rates are designed to allow borrowers to understand the true cost of a loan by taking into account fees and charges, the loan amount and the term of the loan. The comparison rate is based on an unsecured fixed rate personal loan of $10,000 over 3 years. WARNING: Comparison rates are true only for the examples provided and may not include all fees and charges. Different terms, fees or loan amounts might result in a different comparison rate.