What is a personal loan?

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If you need money to pay for a car, home renovations, a wedding, or other purpose, you might be considering taking out a personal loan. This article will explain what personal loans are and some things to consider when comparing them. Reach out to us today.

What is a personal loan?

A personal loan is a flexible loan which is typically unsecured, meaning you do not have to put up a house or car to gain finance. Your rate is often dependent on your credit score and will vary lender to lender.

Personal loans are used for, but not limited to, debt consolidation, cars, motor bike, jet skis, caravans, home improvements, medical bills, private expenses, funeral expenses, education and even gap finance. Although there are some restricted uses, the use of funds from a personal loan is generally pretty open.

Personal Loan Features

Personal loans can be fixed or variable and the fees vary from lender to lender. Some lenders charge larger upfront fees but have cheaper rates as compared to fee free lenders with higher rates. Some personal loans have the flexibility of a redraw and most allow early repayment.

Terms & Rates

Your personal loan finance terms will vary from 1 year to 7 and the amounts can range from $5,000 to $100,000 with most lenders capping a personal loan limit to $50,000.