How Can You Get a Personal Loan in Australia?
Personal loans can be used for major expenses instead of your own money for a single transaction. Find out how you can get approved for a personal loan in Australia.
Personal loans provide various benefits as they can serve as a supplemental source of money that can be used for a variety of purposes. For instance, if you’re looking to renovate your home, purchase a new car, or even go on an overseas trip, you can apply for a personal loan.
Depending on where the loan will come from, you’ll have the option to repay it in practical and flexible ways. This means that by using personal loans for major expenses instead of your own money for a single transaction, you’ll have a better way of managing your finances.
Various Options to Apply for a Personal Loan in Australia
Nowadays, various institutions and organisations offer and process personal loans. Below are your different options when it comes to applying for a personal loan in Australia.
Banks are the most well-known source of personal loans. Since these financial institutions tend to have strict qualification requirements when issuing loans, only clients with high credit scores and those who are earning at certain income levels are able to successfully apply for personal loans.
But, there are also some banks that are more lenient when it comes to issuing loans. They also offer more flexible repayment options than other traditional banks.
A credit union is a member-owned financial cooperative that’s operated by members and shares profits with its owners. Unlike most banks, which are generally for-profit lenders, credit unions have less rigid loan requirements for their members or account holders. They also offer relatively lower rates.
Of course, you’ll only be able to avail of the services of a credit union if you’re a member or an account holder. This can be easily done by finding a credit union or one of its branches near you and following the necessary steps to becoming a member.
As their name suggests, online personal loan lenders enable you to complete the entire process of applying for a loan without stepping inside a bank. These businesses tend to offer more competitive rates and lenient credit requirements than traditional financial institutions.
They’re also ideal for those with low credit scores since many online lenders tend to focus on other factors to determine your payment capabilities, such as your banking activity or job history.
Through peer-to-peer lenders, you can apply for loans that are backed by corporate or individual investors. Like online lenders, a peer-to-peer lender is a great option for borrowers with limited credit history as long as they can show that they have the ability to pay for their loans.
Some of the factors that peer-to-peer lenders evaluate when processing loan applications include the borrower’s educational background, work history, and bill payment history.
Factors to Speed Up Loan Application Approval
Whether you’re planning on applying for a personal loan through a bank, credit union, online lender, or peer-to-peer lender, there are certain factors that you have to consider first. Addressing these factors can help speed up the approval process and allow you to make the most out of your loan option.
Go Over Your Credit Score
You’ll only be able to successfully apply for a loan at traditional banks if you meet their minimum credit requirements. If you’re planning on getting the best loan option, make sure you have a high credit score.
If you own a credit card, ask if your credit issuer can provide you with information regarding your credit score. You can also access this information with the help of an authorized credit reporting bureau.
Gather The Necessary Documents
As lenders process your loan application, they’ll look at various factors to help them determine what your financial background is like. This involves going through certain documents that relate to your financial status.
To help speed up the entire application process, make sure to prepare the necessary documents that will be required by the lender. In addition to official identification cards, these usually include documents related to your employment, income, and residence.
You should also consider getting pre-qualified for the loan option you’re planning on applying for. This process involves informing the lender of the reason why you’re getting a loan. It could be for debt consolidation, home renovation, medical expenses, or vacation costs.
You’ll then be asked how much money you’re planning on borrowing. The lender will then check on certain important details, such as your credit score and employment status. If you have been pre-qualified, you’ll be able to see which loan options you can apply for.
Compare Different Loan Options
To attract more clients, banks, credit unions, peer-to-peer lenders, and online lenders offer different loan options. To get the best available option, go through each one that suits your needs and take note of its loan amounts, payment terms, and additional fees.
By gathering this information, you’ll be able to effectively compare the different loan options available and make an informed decision about which one you should get.
Read The Fine Print
In any type of agreement or transaction, it’s always important to read the fine print. Before signing your loan contract, make sure to thoroughly review it and see if it includes certain details and terms that weren’t discussed with you earlier, such as prepayment penalties and origination fees.
BankWAW Personal Loans
If you’re planning on getting a personal loan, make sure to get in touch with BankWAW. We’re a customer-owned bank operating in northeast Victoria and southern New South Wales, and we’re dedicated to supporting and enriching our community.
We offer a wide range of personal loans that you can use for a variety of reasons, such as overseas trips, new car purchases, debt consolidation, and home renovation. Plus, you don’t even have to worry about monthly service fees. Also, we offer flexible repayment terms to suit your preferences.