Need to borrow up to $5,000 today? A guide on all of your personal loan options, even if you have bad credit.
When you’ve got a bad credit history chances are you can’t get a personal loan from a bank or traditional credit lender. However, if you’re diligent enough, you can find credit providers who offer bad credit unsecured loans. While these firms are more interested in your present financial circumstances and ability to pay back the loan, rather than defaults or negative listings from the past, they come with high fees. If you're unemployed and need a loan, read our guide here.
Loans for up to $5,000 you could apply for
The loans below allow you to borrow cash for a short period when you may need the emergency money.
Warning about Borrowing
It can be expensive to borrow small amounts of money and borrowing may not solve your money problems.
Check your options before you borrow:
- For information about other options for managing bills and debts, ring 1800 007 007 from anywhere in Australia to talk to a free and independent financial counsellor
- Talk to your electricity, gas, phone or water provider to see if you can work out a payment plan
- If you are on government benefits, ask if you can receive an advance from Centrelink: Phone: 13 17 94
The Government's MoneySmart website shows you how small amount loans work and suggests other options that may help you.
* This statement is an Australian Government requirement under the National Consumer Credit Protection Act 2009.
Understanding your loan options
Before applying for any kind of loan, it's important that you understand your options. Below we've outlined two types of $5,000 unsecured loans and the type of borrower they might suit.
The bad credit unsecured loan option
If you have a bad credit rating this type of unsecured loan may be an option for you as the credit provider will focus more on your present capacity to pay back the loan amount. Bad credit unsecured loans also don’t require any assets to be used as collateral. There are several types of unsecured personal loans, and it’s important to compare your options to find out the right type which is suited for your present needs and situation.
It’s also important to note that these loans can have a smaller loan term than a normal personal loan – generally less than twelve months – meaning that your repayments will be higher.
If you’re thinking about getting a bad credit unsecured loan, you won’t have to worry about the negative marks on your credit file as the approval of this loan doesn’t solely depend on your credit background. What is important to the credit providers is that your present financial situation is stable and you will be able to repay the loan.
Apart from the flexible lending criteria set by lenders, a bad credit unsecured loan works much in the same way as any other unsecured loan. Due to the risk taken on by the lender, you may find that these loans have higher rates and fees than other similar loans, or have stricter repayment conditions.
Options for an unsecured $5000 loan with a good credit rating
If you don't have bad credit, a $5,000 personal loan can come at a cheaper cost with a lower interest rate. If you need spending money for a holiday, home renovations or even to finance a wedding a personal loan could be for you. You're able to borrow up to a limit of $5,000 and do not have to attach an asset as a guarantee.
As this loan is unsecured, it is less of a risk for you but more of a risk for the lender. Because of this, you may find that these loans come with higher rates and fees than other secured loans of a similar size and terms. Compare a range of options below if you need to borrow $5000.
How to compare bad credit unsecured loans
- What are the fees?
When you’re taking out one of these loans be sure to look at the fees and charges before you apply to see if you can manage the terms. Loans up to $2,000 with terms between 16 days and one year will not come with fees higher than a 20% establishment fee and a 4% monthly fee. Loans between $2,001 and $5,000 with the same terms will not come with more than a $400 establishment fee and a $48% p.a. rate, which includes all other fees and charged.
- Are there flexible repayment options?
Lenders offer varying repayment periods. Generally you will repay your loan within 16 days and four months, although some lenders offer terms extending up to one or two years. You will usually make repayments in line with your pay schedule.
- How much do you know about the lender?
One of the most important factors to think about in borrowing is the reputation of the lender. Some lenders are not upfront about all the fees and costs that come with late and missed payments and other fees, such as for letter send outs or accounts costs, so be sure to read and understand the lender's loan terms and conditions. Compare the features with other credit providers before applying for the loan.
Tips on being approved for a loan with bad credit
There is no one surefire way to ensure you are approved for a loan application. When you're considering applying for a loan and your credit history isn't perfect, keep the following tips in mind:
- Check the eligibility criteria before applying
Lenders have set eligibility criteria which most of them will set out on their website. Check to see if you meet these criteria, and if you're unsure you can call the lender to discuss your situation.
- Order a copy of your credit file
While you may think you have a good idea of your credit history, your credit file is the only true record of your financial history and what lender's will use to judge your creditworthiness. It's good to be aware of how you appear in the eyes of a lender, and you can order a free copy of your credit file from the main credit reporting agencies in Australia.
- Always compare your loan options before you apply
Every application you make shows up on your credit file, so make sure you compare your options before you apply to minimise the amount of applications you make. More than one consecutive application can be a bad sign to prospective lenders as it indicates a rejected application.
What brands offer bad credit loans up to $5,000?
You have various options when it comes to finding loans up to $5,000. You can consider any of the below. Click through to the review page to find out more details on the loan.
|Max Finance||You can apply for a loan between $1,600 and $10,000 with Max Funding, a lender that has flexible eligibility criteria. You can find out if you've been approved within a few minutes and receive your loan on the same day.|
|Fair Go Finance||This lender offers cash loans between $500 and $5,000 and also secured loans between $2,250 and $5,000 to borrowers in a range of situations. You may be able to apply if you're self-employed, on Centrelink or employed casually. You can apply if you have bad credit, with each application assessed on a case-by-case basis.|
|Credit24||You can apply for a loan between $300 and $6,500 with Credit24 if you're employed and earn at least $1,000 per month. If you are on Centrelink benefits they can't make up more than 50% of your income. It should be noted you need good credit to apply for this loan.|
|Nimble||You can apply for loans up to $5,000 with Nimble, with your eligibility assessed on a case-by-case basis. The loan term can be between 16 days and one year, giving you longer to repay what you borrow.|
|Wallet Wizard||With its 'Smart Loan', you can apply for up to $5,000 with Wallet Wizard. You'll pay an upfront application fee plus ongoing service fees, with loan terms being able to extend up to 36 months for returning customers. Wallet Wizard has very flexible lending criteria, which opens the doors for bad credit, Centrelink borrowers and even unemployed applicants. The important thing is that you have the ability to repay your loan.|
|Good to Go Loans||You can apply for a cash loan between $500 to $5,000 for various needs, and the loans are available to borrowers with bad credit. If you need a new car or own your own business, G2G Loans also offer secured and business loans.|
|Needy Money||With its medium loan, Needy Money lets you apply for between $2,001 and $5,000 even if you have bad credit. Generous repayment terms of up to 2 years are on offer, giving you plenty of time to budget and repay your loan.|
What to consider when comparing $5000 loans
- The convenience of an online application
The convenience of online application forms and quick approval systems can save you time. You’ll also have a chance to compare a range of credit providers, improving your choices.
- There are minimal or no credit checks
It's common practice to find difficulty being approved for a personal loan from other credit providers if you’ve got a bad credit history. Getting a bad credit unsecured loan gives you access to lenders who look at your current financial situation when considering you for a loan, and if you have major credit problems you can consider a no credit check loan.
- The simple repayment terms
You'll generally have your repayments lined up to when you get paid, and some lenders will give you the option of how to make repayments. Direct debit repayments are offered by most lenders as you don't have to worry about making the repayments yourself, you just need the money available in your account.
- The loans are high-cost
Due to high risk of this loan the lender will usually charge a higher fees. However, keep in mind fees are capped by ASIC.
- Loans over $2,001 come with high interest
While loans under this amount do not come with interest rates (only set fees) loans above this amount come with rates maxed at 48% p.a.
- Disreputable lenders operate in the payday space
There are many disreputable lenders operating online who prey on people with bad credit, so make sure you evaluate the lender before you apply.
Things to avoid with bad credit unsecured loans
There are quite a few risks associated with these types of loans. Avoid the pitfalls outlined below:
- Be cautious throughout the whole process; ASIC has issued a warning to those intending to take out a bad credit personal loan due to high fees and inflexibility.
- High fees and short a repayment period; make sure you think twice before applying for a bad credit unsecured personal loan up to $5,000 – the repayment period is a lot shorter than standard loans.
- Higher interest rates; major banks and lending institutions must show a comparison rate for all loans. The comparison rate is essentially the interest rate of the loan with the fees and charges included in an APR. Short term lenders may not, so it is important to check the interest and comparison rates before applying
Quick ways to borrow money
|Type of Lender||Avg. Interest Rate||Avg. Repayment||Turnaround Time|
|Traditional Bank||14% p.a.||$1041.93*||1-3 business days|
|Online Lender||39.20% p.a.||$672.24^||1 hour - conditions apply|
|Payday Loan||319.38% p.a.||$1280~||Same day|
|Peer-to-Peer Loan||8.86% p.a.||$955.21*||Next business day|
*average repayment based on a $30,000 loan over 3 years | ^ based on a $3,000 loan over 220 days | ~ based on a $1000 loan over 32 days
Frequently asked questions
How do I start if I want to apply for a bad credit unsecured loan?
An easy way is to apply online by clicking the "Go to Site" button on this page.
After submission of my application, what will happen?
This will differ between lenders, but generally you will receive a notification as to whether you have been approved or not along with further instructions for the next steps.
Are my details secure?
When you apply for a loan online up to $5000, your details are securely transmitted over an encrypted connection. The majority of sites you apply with use 128-bit SSL encryption to ensure your details are safe and secure.
Can I get a $5000 loan if I am unemployed?
When an institution lends you money, they want to be 100% certain that you can repay back the debt within the allocated time-frame. If you are unemployed your income may be limited unless you are receiving Centrelink benefits. If the majority of your income comes from Centrelink payments you may be still eligible for a personal loan - please read our guide to getting a loan on Centrelink before applying.