How to choose a personal loan
Read our guide to finding the right personal loan for you.
If you're looking at getting a personal loan, it's important to understand all the options that are available to you.
Applying for the wrong type of loan could end up costing you time and money, and getting a loan you can't afford could have a long-term impact on your ability to borrow in the future.
Compare personal loans
How do personal loans work?
A personal loan is a financial product that lets you borrow a specified amount from a lender that you then have to repay with interest over a set period of time. You typically have to pay back a personal loan over one to seven years, but you may be able to pay it back early, depending on the lender. You can use the loan for any worthwhile purpose, including personal expenses, purchases, travel or debt consolidation, and you can generally borrow from $1,000 to $100,000.
A quick guide to personal loan types
How to compare your options and choose a personal loan
- Check the repayment flexibility. Most lenders offer you the choice of weekly, fortnightly or monthly repayments to line up with your pay schedule, but this is not always the case. You should also find out if you are able to make extra repayments without penalty or restrictions and whether you can pay back the loan before the end of the term.
- Make sure you can use the funds for the purpose you need. Some loans, especially secured loans, come with restrictions on how you can use the loan amount. For example, if you get a car loan, you will only be able to spend the loan funds on a vehicle purchase and the vehicle needs to be eligible. Similarly, some lenders will not let you use a personal loan for business purposes. Make sure you can use your loan how you need to.
- Find out how easy the loan will be to manage. You'll find that online account management is on offer from most lenders, but not all. You may also be required to pay the loan rather than using a direct debit, which is a standard for many lenders. You should also check how easy the lender is to contact and find out how you can contact them.
- Determine if the repayments will be manageable on your budget. Use the personal loan repayment calculator to see what repayments you will need to make and then make sure that these repayments will be manageable on your budget.
Loan Repayment Calculator
Questions you need to ask to find the right loan
Before you settle on a personal loan, there are several questions that you should ask to make sure it's right for you.
Personal Loan OffersImportant Information*
You'll receive a fixed rate between 6.99% p.a. and 25.69% p.a. based on your risk profile.
Apply for a loan up to $50,000 and repay your loan over 3 or 5 years terms.
You'll receive a fixed rate between 9.99% p.a. and 18.99% p.a. ( 10.88% p.a. to 19.83% p.a. comparison rate) based on your risk profile
An unsecured loan up to $55,000 you can use for a range of purposes and pay off over up to 7 years. Note: Majority of customers will get the headline rate of 12.69% p.a. (13.56% p.a. comparison rate) or less. See Comparison rate warning in (i) above.
You'll receive a fixed rate between 6.99% p.a. and 20.49% p.a. based on your risk profile
A loan from $5,000 to use for a range of purposes. Benefit from no ongoing fees and no early repayment fee.
You'll receive a fixed rate between 6.95% p.a. and 17.95% p.a. based on your risk profile
A loan from $5,000 to use for a range of purposes. Make additional repayments or pay off the loan early, penalty-free.
Ask an Expert