Did you know that the average Aussie takes out a personal loan amount of up to $16,000? Applying for a personal loan is commonplace for people of all ages, whether for debt consolidation, or a luxury purchase.
It is great advice to research personal loans before submitting an application, however, ensuring that you find the best personal loan.
Contact an expert mortgage broker at Lendstreet for the latest personal loan deals and to assess your eligibility!
A personal loan is a type of finance that is usually granted for a short-term period. You may apply for a personal loan for a variety of reasons such as renovating a home, purchasing a car, or consolidating debts. It is a great finance product when you need a sum of money fast!
A personal loan is usually an unsecured loan, although it may be possible to apply for a secured personal loan.
Secured loans need collateral such as an asset so that the lender approves your application. If you default on the repayments, the asset may be seized from you to cover the debt.
However, unsecured personal loans are stand-alone debts and are not secured against anything. For this reason, it is sometimes more difficult to successfully acquire an unsecured personal loan.
A personal loan will come with an interest rate and a loan term to consider. A fixed interest rate would provide you with some security against fluctuating costs.
Your builder, architect, council, surveyors, and other contractors are all a part of your new home construction. As such, for the approval of a construction home loan, you may be required to provide additional documentation. Further terms and conditions may also apply if you are an owner-builder.
How can I use a personal loan?
You can use a personal loan for anything! You have the flexibility and control over what you can spend the money on. There are some lender exceptions so check with your broker first.
You could use your personal loan for:
- Consolidating debts
- Renovating your home
- Paying for a holiday
- Financing a car
- Setting up a small business
- Paying for other expenses
Should I apply for a personal loan?
You should only apply for a personal loan if you need the money. Remember, you will pay interest on the money you borrow and so the loan will cost you money in the long term. Your loan amount and loan term may include a high-interest rate, costing a high sum of money over time.
It is advisable to exhaust all other avenues for funds first before applying for a personal loan.
What are the main reasons you might apply for a personal loan?
You may need to apply for a personal loan to consolidate debts. Many people benefit and save money by consolidating debts as they can reduce the interest payable.
Your professional broker could find you a low-interest rate personal loan to significantly reduce your remaining debts. This is particularly useful if you have several credit cards with high interest.
What if you need to make improvements to your home? If the improvements are merely cosmetic, perhaps you could save money gradually over time.
Although, if the home improvements are more functional, you may need the money fast! A personal loan is a perfect option in this situation, helping you and your family live comfortably.
You may decide to purchase a car, or pay for a holiday, with the funds from a personal loan. It is always advisable to save up your money for luxury spending, as opposed to securing finance.
However, what if you need your car to commute to work? What if you need a holiday to recuperate after a long illness? In these circumstances, a personal loan may be the answer you are looking for.
What Is the best personal loan available?
Your specialist broker can advise you on the best personal loan deals available to you. Your options available may depend on your credit score as well as your income. What should you look for when searching for the best personal loan?
Low Interest Rate
Look for personal loans with a low-interest rate. The lower the interest rate, the less interest you will need to pay the lender.
Your broker can advise you on which interest rate options are available to you. Unfortunately, a lower credit score may mean a higher interest rate.
How many years do you want to spread the cost of your personal loan? You will have to specify your preferred repayment terms in your loan application.
However, you may pay less interest for a shorter loan term so always think about this option! A higher credit score and healthy credit report will provide you with greater flexibility in this area.
Always know what fees your lender will charge you and when! Are any fee waivers available? If you seek the services of a Lendstreet broker, you will always receive transparency and understand every cent payable.
Will your lender charge you late fees? Will your lender charge you a fee before you receive the personal loan money? Obtaining free broker advice from Lendstreet will ensure you choose the best lender and the right personal loan for you.
How can I apply for a personal loan?
The best way to apply for a personal loan is through a broker who can provide you with impartial advice. Lendstreet will charge you ZERO FEES to find you the best lender and the best personal loan deal. We receive our fee from the lender!
Use Lendstreet’s Personal Loan Calculator today to find out what personal loans may be available to you!
But, what information is considered when you apply for a personal loan?
A lender needs to know that they will receive their money back, in addition to interest! They will assess your level of income and calculate your personal debt-to-income ratio.
This determines the amount of income that already pays debt instalments. If this figure is quite low, the lender may determine that you can afford a new personal loan repayment per month. Although, if your debt-to-income ratio is high, they may assess that you cannot afford it.
What is your credit score? Your credit score is a summary of your credit report history. Every debt you have secured and every repayment you have made is recorded. So too are any repayments you have missed!
A high credit score will mean that lenders determine you to be a reliable lender. You will have many more options available to you to choose from, with favourable rates and terms.
A low credit score will mean that the lender assesses you as being an unreliable borrower. They may refuse to grant you a personal loan, or you may have to choose a high-interest rate loan.
How much would personal loan repayments cost?
Lendstreet’s Personal Loan Calculator can tell you immediately how much personal loan repayments may cost you every month! We can detail all repayment terms in a clear way, letting you know if there are any early repayment fees.
Simply enter the correct information in the personal loan repayment calculator! You can see how much you will need to pay in instalments.
Decide how much you want to borrow and over how many years. Do you want to pay your repayments monthly, weekly, or fortnightly? What do you want to use your personal loan for? Personal loan repayment calculators can be adjusted accordingly.
For example, if you take out a $16,000 personal loan for 3 years, how much will your repayments be? You may pay $502 per month with a 7.99 % p.a. interest rate. You will also be able to see the loan amortisation table to see exactly how your payments and interest rate are calculated.
Speak with your Lendstreet expert who will prepare comparison rates to find you the best loan. We could even find you cost savings and fee waivers to save you money!
How can I increase my borrowing power?
Borrowing power is not just calculated to limit how much you can borrow in your home loan balance. Borrowing power acts as a safeguard so that you can comfortably borrow money without struggling to meet repayments.
It is important to remember that when you take out a home loan, your property is at risk of repossession. If you stop paying your home loan repayments, a lender can apply for foreclosure and you will lose the property. A property repossession will badly damage your credit history.
Borrowing a higher amount of money increases the risk that you may face difficulties. However, if you want to increase your borrowing power, here are some measures you could take
Visit Lendstreet Today for Free Advice!
Lendstreet offers a vast range of tools for you to use from the comfort of your own home. Use Lendstreet’s Personal Loan Calculator to find out what personal loan repayment options are available to you!
Your broker specialists are waiting for you to get in touch! Discover the perfect personal loan for you and your financial situation! Contact Lendstreet today for the latest deals and lender profiles from your Australian Credit Licence professionals.
What is the max you can borrow on a personal loan?
The highest personal loan sum that you could borrow is around $80,000. That is for an unsecured personal loan in Australia. You borrow a much higher personal loan amount if you apply for a secured personal loan, with great collateral. Discover the maximum you can borrow using Lendstreet’s personal loan repayments calculator.
How much can I borrow based on my income?
To find out the exact figure, visit Lendstreet’s Personal Loan Calculator. However, in general, your debt should not rise above 28% of your income. This depends on your lender, the credit criteria, and your financial situation, however.
What is the disadvantage of a personal loan?
The main disadvantage of a personal loan is that you have to pay interest on the amount you borrow. However, you may have to accept a higher interest rate, especially if you have a low credit score. Additionally, you may have to pay early repayment fees, or penalties to pay periodically.
What is the advantage of a personal loan?
A personal loan is quite easy to apply for. You can complete a personal loan application quickly with the help of a Lendstreet broker. A range of comparison rates may be available. Ask your broker which comparison rate is best for you!
A great aspect of a personal loan is that you can usually spend the money on anything you like. There is usually no stipulation.
Furthermore, you may be able to get a low-interest rate if you have a good credit score. A great credit score may mean fantastic personal loan terms, too!