We Can Help You With a Personal Loan
There are many different circumstances under which you might be required to take out a personal loan. It might be a new car, a house renovation, or even that long-awaited overseas holiday.
What sort of personal loans are available?
There is a huge range of personal loan products available so there are a few questions you will want to consider.
Speak to Our Broker if you need finance for any of the following:
- Debt consolidation
- Furniture and appliances
There are a range of options on offer and Our Broker can help you select the right one for you.
With a secured loan, the asset (e.g. car) you're purchasing is used as security against the loan. The downside is that if you default on your repayments, the lender can repossess your asset, sell it and use the funds to pay off your debt. However, a plus is that these types of loans can be advertised at a lower interest rate because they're considered a lower risk for the lender.
An unsecured loan is considered a higher risk for the lender because it doesn't require any security against the loan. This means they usually come with a higher interest rate than a secured loan. If this is the first time you're taking out a personal loan, the lender may require you to provide a guarantor as a backup to ensure your repayments will be met.
What personal loan product types are available?
A variable rate loan gives you the flexibility to pay extra off your loan when circumstances allow, while you can also redraw those funds if and when you need them. However, variable loans are subject to interest rate rises, so it's important to calculate your ability to make repayments both now and in case of a future rate hike.
A fixed rate loan means your repayments are set at a certain figure, shielding you from interest rate rises for the life of the loan. You can also pay extra off your loan, although it's wise to check the limits on the number of additional payments you can make.
An overdraft loan is a convenient way to have quick access to funds for those unexpected financial emergencies. With an overdraft, you only pay interest on the money you use, however the maximum loan amount is usually capped. However, the interest rate can be higher with this type of loan compared to other types of personal loans, so it pays to do your homework.
Line of credit
A line of credit loan offers you access to funds as you need them, meaning you can withdraw additional funds as needed. A big plus is that you only pay interest on the money you use, and not the total amount borrowed. Also, there is no need to apply for another loan should you need more money, as you can redraw on your available balance. Be aware that a line of credit usually has a minimum and maximum amount you can access, however the limit is usually higher than the amount available using an overdraft loan.