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The 8 Personal Loan Features To Consider

Written by

Shaun McGowan

Loan Features

Personal loan features are the unique aspects of each loan product offered by a specific lender, which may make the loan more or less suitable for each person depending on their personal circumstances.

Simply put, loan features are restrictions or freedoms offered by an individual loan product, and include things like extra payments, payment dates, redraw facilities, and more.

Below, we’ll cover the important loan features you’ll see when applying, so you can decide which is most important to you when choosing a loan.

1. The ability to make extra repayments

Extra payments help pay your loan off faster. The faster you pay off your loan, the less you’ll pay in both interest and fees.

To save yourself money and make it easy to repay your loan faster, it’s a good idea to look for a loan that allows extra repayments and early loan repayment without charging fees.

Keep in mind that extra payments and paying out your loan entirely without fees are separate loan features.

Pay off your defaults to improve your credit rating

2. Weekly or fortnightly repayments

Choosing your repayment frequency can make managing your loan repayments with your income frequency much easier.

Many debt consolidation loans allow you to choose your repayment frequency - weekly, fortnightly or monthly, and some even allow you to choose the day of the week your repayment falls on.

If you have the option to do so, you could set your loan repayments up so that they fall directly after your payday - that way you’ll always have money in the bank to pay them.

Loan overdrafts

3. Ability to redraw

A redraw facility allows you to withdraw any repayments above the minimum amount as needed.

This means, if you’ve made extra repayments, you can withdraw that amount without needing to apply for another loan or use an overdraft.

This isn’t a great feature to look for if you’re planning on reducing your debts quickly, but it can provide a great deal of flexibility in accessing finance as you need it.

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4. Pay out the loan early (with no fee)

Just like making extra repayments, some loans may allow you to repay the loan in full early and save on interest charges.

A common example of this is when you are getting a loan for a car. Most car loans are taken for 5 years but over half are paid out before the end of the term.

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5. Fees

Loan fees can include any number of charges, but the most common will be application fees or ongoing management fees. Try and negotiate the former, and always try to avoid the latter; they’re an unnecessary charge you don’t need.

Note that some loans with zero fees may have higher rates, or other unavailable features due to the removal of fees.

Use our personal loan calculator to see how fees can impact your repayments.

Fees on loans to be aware of

6. Fast Approval

If you’re looking for approval fast, this is the feature to look out for. Some lenders may have more relaxed approval processes, and others may utilise financial technology to instantly assess your application.

Fast approval on a loan will always be easier if you are a secure applicant, providing collateral and applying for a loan amount you can comfortably prove you will repay in full.

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7. Payment Holiday

A payment holiday isn’t always a vote of confidence, but it can be a great security backstop if things don’t go well in the future. It can be a fantastic feature if you’re unsure about consistency in your finances over the entire term of the loan.

For example, some loans may include redundancy cover, handling your payments for a period of time in the event you are made redundant.

Others may allow you to take a payment holiday for a set time should you experience financial distress, pausing your payments instead.

Make sure you understand how your provider handles payment holidays and catch-up payments.

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8. Customer Service

Lastly, customer service won’t be a feature listed on your loans, but is just as crucial to keep in mind when choosing a provider.

Chances are, you’ll be dealing with your loan provider more than once over the term of your loan, so make sure to check out reviews and customer feedback to make sure you’ll get the help you need, when you need it!

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We understand that the world of finance is complex, and offer free, extensive guides on Personal Loans, Car Loans and Business Loans, along with tools like our Budget Planning Spreadsheet to help you better manage and understand personal finance.

About the Author

Shaun McGowan from



Shaun McGowan

Shaun is the founder of 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 and Lend.


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