Personal loans are popular options for Australians looking to finance home improvements and other major expenses. With personal loan rates at record lows, they are also useful tools for consolidating and paying off debt.
Inexpensive interest rates and blazing-fast online application and approval times are big draws, but there are a few important things to keep in mind when looking for a low personal loan rate. Here are five essential tips from the Mozo experts:
1. Use a good credit score to get a low rate
Online lenders reserve their best rates for borrowers with excellent credit, which is generally a score above 800. To improve your credit score, pay bills on time, make credit card payments before the due date and try not to apply for too many credits or loans. products
2. Find and Compare Rates Online
To find the most competitive personal loan rates, you’ll need to look beyond the big banks. The smallest online lenders have some of the lowest rates for unsecured personal loans, with interest rates starting at less than 6.00% for borrowers with excellent credit.
3. Use online rate estimation tools
Some lenders allow you to enter a few details online to get a quick personalized rate quote without affecting your credit score. It usually takes just a minute or two and you will get an estimate of the lowest rates available to you before submitting an actual application.
4. Don’t go overboard with the loan amount
Before applying for a loan, check that you can comfortably meet the payments. Use an online calculator to see how much you can borrow and what your monthly payments will be.
5. Stay away from payday loans and quick cash
Payday loans can be quick and easy to arrange, but in Australia the legal interest rate cap for these loans is a staggering 48% per annum plus hefty upfront fees.
Do you want to compare more personal loan options? Head over to our personal loan hub for more providers, as well as tons of helpful guides and tips.
* WARNING: The Comparison Rate combines the lender’s interest rate, fees, and charges into a single rate to show the true cost of a personal loan. Comparison rates shown are based on a $ 30,000 loan for a 5-year term or a $ 10,000 loan for a 3-year term, as indicated, based on monthly principal and interest payments, over a secured basis for secured and unsecured loans. basis for unsecured loans. This comparison rate applies only to the example (s) given. Different amounts and terms will result in different comparison rates. Costs, such as rework fees or early repayment fees, and cost savings, such as fee waivers, are not included in the comparison rate, but may affect the cost of the loan.
^ View information about Mozo Experts Choice personal loan awards
Mozo provides general product information. We do not consider your personal goals, financial situation or needs and do not recommend any specific product. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.
While we pride ourselves on covering a wide range of products, we do not cover every product on the market. If you decide to order a product through our website, you are dealing directly with the supplier of that product and not with Mozo.