A personal loan lets you borrow money to pay for something special, like a holiday, car or home renovations. You have to repay it with interest over a fixed term, usually between one and seven years.
Getting the best deal on a personal loan can save you thousands in interest and fees.
Get the best personal loan for you
Most people shop around before they pick a holiday or buy a car. Shopping around for the right loan can save you thousands in interest and fees.
Fixed or variable interest rate
With a fixed interest rate, your repayments are fixed and won’t change over the loan term. You’ll know exactly how much will come out of your bank account each month.
With a variable interest rate, your repayments will change if interest rates change. If interest rates rise, your repayments will be higher. If interest rates fall, your repayments will go down.
A loan with a variable interest rate usually has no early exit fee. This might be better if you’re planning to pay the loan back early.
The interest rate you get on a personal loan can be different to the advertised interest rate. Your interest rate depends on things like your credit score, income, expenses, and savings.
Secured or unsecured loan
With a secured loan you provide an asset, such as your car, as security for the loan. If you don’t pay the loan back on time, the lender can repossess your asset and sell it.
With an unsecured loan, you don’t have to provide an asset as security. But the interest rate will be higher, and you may need a loan guarantor. If you fail to pay back the loan, the lender can still take you to court to get back the money you borrowed.
Loan guarantor
Some lenders will give you a lower interest rate if you have a loan guarantor. Before you ask a family member or friend to go guarantor for you, make sure you both understand the risks for a guarantor.
Small personal loans
If you need to borrow up to $3,000 quickly for essentials, like a fridge or car tyres, see if you can get a no or low interest loan. These loans have a low interest rate, no fees and quick approval.