Finder makes money from featured partners, but editorial opinions are our own.

How to get a personal loan with average credit

You may be eligible for a risk-based personal loan, but expect to pay higher interest rates.

{"visibility":"visibilityTable","ctaLabel":"Calculate","tableCode":"AUFPL_COMPARISON_V2_TABLE","nicheCode":"AUFPL","fields":[{"name":"LOAN_AMOUNT","value":"20000","options":"","label":"Loan amount","suffix":"$","useSuffixAsPrefix":true,"useDropDownOption":false,"tooltip":""},{"name":"PERIOD","value":"3","options":"","label":"Loan term","suffix":"years","useSuffixAsPrefix":true,"useDropDownOption":false,"tooltip":""}]}
Name Interest Rate (p.a.) Comp. Rate (p.a.) Application Fee Monthly Fee Monthly Repayment
OurMoneyMarket Unsecured Low-Rate Personal Loan
OurMoneyMarket logo
Finder award winnerFixed1 - 7 Years $2,001 - $75,000
Interest Rate (p.a.)
6.57%
to 18.99%
Comp. Rate (p.a.)
7.19%
to 21.78%
Application Fee
1.50% - 6%
min. $250
Monthly Fee
$0
Monthly Repayment
$627.42
Go to siteMore Info
NOW Finance No Fee Unsecured Personal Loan
NOW Finance logo
Finder award winnerFixed18 Months - 7 Years $5,000 - $50,000
Interest Rate (p.a.)
6.75%
to 26.95%
Comp. Rate (p.a.)
6.75%
to 26.95%
Application Fee
$0
Monthly Fee
$0
Monthly Repayment
$615.26
Go to siteMore Info
Harmoney Unsecured Personal Loan
Harmoney logo
Finder award winnerFixed3 - 7 Years $2,000 - $70,000
Interest Rate (p.a.)
5.76%
to 24.03%
Comp. Rate (p.a.)
6.55%
to 24.98%
Application Fee
$275 - $575
Monthly Fee
$0
Monthly Repayment
$623.70
Go to siteMore Info
NAB Personal Loan Unsecured Fixed
NAB logo
Fixed1 - 7 Years $5,000 - $55,000
Interest Rate (p.a.)
8.49%
to 20.49%
Comp. Rate (p.a.)
9.54%
to 21.49%
Application Fee
$250
Monthly Fee
$10
Monthly Repayment
$649.15
Go to siteMore Info
NAB Personal Loan Unsecured Variable Rate
NAB logo
Variable1 - 7 Years $5,000 - $55,000
Interest Rate (p.a.)
8.49%
to 20.49%
Comp. Rate (p.a.)
9.54%
to 21.49%
Application Fee
$250
Monthly Fee
$10
Monthly Repayment
$649.15
Go to siteMore Info
loading
Showing 5 of 5 results

If you have an average credit score, you may be worried about getting a personal loan. While once it may have been difficult to obtain finance, this is no longer the case. Big banks are no longer the only players, with alternative and online lenders providing options for borrowers with a variety of credit histories. This means that your credit score is no longer an impediment, but it’s likely you’ll have to pay higher interest on the loan. 

What is a credit score? 

Your credit score is a snapshot of your creditworthiness. It shows how responsible you are as a borrower and what kind of borrower you are. Your score will reflect whether you’re someone who always pays their bills on time or if you have a few or several defaults or late payments. Your credit score is presented as a number corresponding to your history with credit. 

Your credit score will contain information about the credit products you’ve taken out, the number of credit applications you’ve made, your repayment history and defaults on utility bills, credit cards and loans.

You can check your credit score for free with Finder.

In Australia, there are three credit reporting agencies that will calculate your credit score: Experian, Equifax and Illion. Your score can differ based on the credit reporting agency. For instance, with Experian and Illion, scores will range from 0 to 1,000, while for Equifax the range is 0 to 1,200. 

The average credit score for Australian adults is approximately 550. In practical terms, a credit score of 550 means there is a one in 12 chance you’ll have a negative event, such as a loan default, recorded on your credit file within the next year.

A credit rating of 600 or higher will put you in the “good” or “excellent” categories. Anything lower than 500 will be considered “fair” or “weak” and classify you as a riskier borrower.


What is an “average” credit score?

What constitutes an “average” score will depend on the credit rating agency. We’ve highlighted the average scores for each credit rating agency.  

RatingExperianEquifaxIllion
Excellent800 - 1,000833 - 1,200800 - 1,000
Very good700 - 799726 - 832700 - 799
Good/average625 - 699622 - 725500 - 699
Fair/average550 - 624510 - 621300 - 499
Below average0 - 5490 - 5091 - 299

There are several reasons why your credit score can differ between agencies. It all comes down to the scale (0 to 1000 or 0 to 1200), the calculations they use and the information they have. Credit providers may not provide this information to all credit reporting agencies. This data may also be provided at different times, accounting for a difference in scores. The differences in scores aren’t something you should worry about. It’s a feature, not a bug. You could, however, check your credit reports to make sure the information entered is correct. 


What personal loans can I get with an average credit score? 

Loan typeDetails
Secured personal loanThis loan will require an asset as security. Providing an asset will offset the lender’s risk, making them more amenable to lending to you. Generally, secured loans come with lower interest rates and higher borrowing amounts. You can also apply with a guarantor, which can help your chances of approval.
Peer-to-peer personal loanThese loans involve a third-party lender that matches borrowers to private, individual investors. The third-party acts as a facilitator inviting investors to finance loans in a portfolio, classified by their level of risk. Peer-to-peer loans offer risk based pricing, where your interest rate is determined by your credit score. With an average score, you’re likely to get a higher rate.
Car loanCar loans are secured by the car you’ve purchased, thereby making them lower risk to lenders. It’s likely, however, that with an average score, you’ll get a higher interest rate.

What’s the minimum credit score required to get a personal loan in Australia?

In general, most traditional lenders will require you to have at least a “good” credit score to qualify for a personal loan. The higher your score, the better your chances. If you’re concerned about your score, you may want to consider a lender that offers risk-based personal loans. That way, you’re still likely to get a loan, but you should be prepared to pay more.

What will my interest rate be?

Lenders now offer risk-based pricing to determine the interest rate of the loan. With risk-based loans, the lender doesn’t offer a set interest rate. Instead, there will be a range corresponding to your credit score. If the lender decides to offer the loan, they will choose an interest rate within that range. This reflects how risky your loan is to the lender. In general, the better your credit score, the less risk for lenders. This means you’ll pay a lower interest rate. 

For instance, a lender may advertise interest rates between 12.99% p.a. and 19.99% p.a. If you have good or excellent credit, you’re likely to be offered a rate closer to 12.99% p.a. An applicant with average credit, meanwhile, may get an offer closer to the upper limit of 19.99% p.a. 

Besides your credit score, the lender will also take into account the following: 

  • The loan amount 
  • The loan term 
  • Your financial history 
  • Your employment history 
  • Your personal circumstances. 

How do I compare risk-based personal loans?  

It may be more difficult to compare loan products with risk-based pricing. This is because you won’t know the rate you’ll be offered until you apply. The following may, however, help with the comparison: 

  • Interest rate range. While you won’t know the exact rate you’ll be offered, you could still take the rate range into consideration when comparing.  
  • Security. Is the loan secured or unsecured? If you have residential property to offer as security, you’re likely to be offered more favorable terms. Providing security will also increase your chances of approval. 
  • Fees and charges. Fees like application fees and ongoing fees contribute to the cost of your loan. Other factors like early repayment fees and early exit fees are also important to watch out for, particularly if you want to make additional repayments and pay off the loan early. 
  • Eligibility. Always ensure you’re applying for a loan you’re eligible for. Besides credit requirements, they will also look into your income. This is to ensure you can repay the loan without difficulty.  

Why compare personal loans with Finder?

freeYou pay nothing. Finder is free to use. And you pay the same as going direct. No markups, no hidden fees. Guaranteed.
expert adviceYou save time. We spend 100s of hours researching personal loans so you can sort the gold from the junk faster.
independentYou compare more. Our comparison tools bring you more personal loans from across the market.

Frequently Asked Questions

More guides on Finder

  • Finder Personal and Car Loan Awards 2024

    Check out the Finder Personal and Car Loan Awards winners and finalists for 2024.

  • Laptop loans and finance options

    Find out everything you need to know about getting a loan for your laptop purchase, including what's available, if you're eligible and how to compare.

  • Loan and finance options for weight loss surgery in Australia

    Planning on getting weight loss surgery? Learn your options and compare medical loans today.

  • Wisr Personal Loan

    Wisr’s Personal Loan comes with fixed personalised interest rates.

  • How much can I borrow with a personal loan?

    Personal loans offer a range of loan amounts to suit different purposes and budgets. Here's how to get the loan amount you need.

  • Engagement Ring Finance

    If you're considering an engagement ring loan, find out your options here and get the perfect ring for your spouse-to-be.

  • Apprentice loans

    If you're thinking about getting an apprentice loan, explore the possibility of government-sponsored loans as well as loans offered by banks. Find out everything you need to know to compare your options.

  • Swimming Pool Finance

    Swimming pools are a great way to spend your summer while increasing the value of your property. If you're looking to invest in a swimming pool, find out about your personal loan options here.

  • Same Day Personal Loans

    We’ve written about how you can get a same day personal loan and how to speed up the process.

  • A guide to interest rates

    Compare your options and know what to look for with the highest or lowest interest rate.

Ask a Question

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms Of Service and Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site