Personal loans for students
Find out what loan options you have as a student.
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What's in this guide?
- How does a student loan work?
- What types of personal loans can students consider?
- What can I use a loan for?
- How will I know if I am eligible for a student personal loan?
- How to compare student loans
- Compare personal loans available to students side by side
- What discounts and eligibility criteria apply to student personal loans?
- What to avoid when applying for a student loan
- Tuition fees and FEE-HELP loans
- Frequently asked questions
- Next steps
How does a student loan work?
Student loans work the same way as personal loans available to others working full-time and who have left their studies. The main differences are the eligibility criteria, which is usually more flexible to allow those with lower incomes and fewer assets, or those with part-time jobs, to apply and be approved. Because of these, student loans are usually for smaller amounts and the terms and repayments may be stricter. These personal loans may also come with benefits, such as discounted interest rates or waived fees.
Keep in mind that while many student loans can be used to finance a range of purposes, you may want to avoid taking out a student loan to cover small, everyday expenses. You need to factor the loan repayments into your budget before you apply, and if you are already struggling to manage your everyday expenses, adding loan repayments into your budget may not be your best option.
What types of personal loans can students consider?
When it comes to selecting a student loan, there are a few options available:
- Secured personal loan. This type of loan requires you to attach an asset, such as a car or equity in a home, as a guarantee in order to be approved for the loan. These loans can be fixed or variable and usually come with lower rates due to the guarantee, which can be repossessed by the lender in case you default on the loan.
- Unsecured personal loan. This loan does not require a guarantee, although as such, usually comes with higher rates. This type of loan is generally more flexible and can be used for a range of purposes, and also comes with fixed or variable terms.
- Medical student loan. This is an innovative type of loan offered by a few lenders to medical and dental students. Qualifying students in their final year of study can secure a loan that they can put towards their course, living expenses, debt consolidation or other purposes.
- Graduate loan. If you’re a university student in your final year of study, you may be eligible to take out a loan and enjoy no repayments for the first year. This graduate loan can be used to finance anything of your choice and can help cover expenses while you find a job in your first year out of uni.
- Car loan. If you’re looking at purchasing a car, students may also be eligible to take out a car loan with a wide range of lenders. These loans require that you attach the car as a guarantee on the loan, but in return you can usually enjoy quite competitive rates and fees.
- Payday loan. If you really find yourself strapped for cash and in an emergency situation, you also have the option of taking out a short-term loan. These are small, short-term financing solutions and can be accessed by those receiving benefits, working part-time, or even those with bad credit.
- StepUP loans. StepUP loans are a form of low interest loan offered by the not-for-profit Good Shepherd Microfinance in collaboration with NAB. These loans are available up to $3,000 at a rate of 5.99% p.a. They can be used for expenses such as cars, household appliances, education, laptops and medical expenses.
- Interest-free loans. No Interest Loans (NILS) are available to Australians who have a Health Care Card or Pension Card, earn less than $45,000 per year after tax ($60,000 for couples or people with dependants), have lived at their current or previous address for at least three months, and who show a willingness and the capacity to repay the loan. These loans are available up to $1,500, and can be used for a variety of purposes. There are also various forms of other government assistance that may benefit students.
- Buy now, pay later. Many retailers offer interest-free finance via platforms such as Afterpay, Zip Money, Humm, Bundll and more. Buy now pay later providers allow you to spread the cost of purchases over a longer period of time, which can be easier on your budget. If you're looking for a loan to make a large purchase, for example, a laptop, check to see if you can find a retailer offering interest-free finance before opting for a loan.
Student loans comparison
- SocietyOne Unsecured Personal Loan (2-3 years): 6.39% p.a. comparison rate. A SocietyOne personal loan offers lower rates for good credit borrowers.
- IMB Secured Personal Loan: 6.80% p.a. comparison rate. A competitive secured loan that can help you finance that unsecured purchase.
- HSBC Unsecured Personal Loan: 9.06% p.a. comparison rate. A competitive fixed interest rate and flexible repayments. Students can apply.
- NAB Personal Loan Unsecured Fixed: 7.91% p.a. comparison rate. Get access to the funds you need with the NAB Unsecured Personal Loan.
What can I use a loan for?
You can use a personal loan for pretty much any legitimate reason. Common reasons that people who are studying take out personal loans include:
A laptop is a basic necessity for pretty much every student, but unfortunately they don't come cheap. You can use a small personal loan to buy the laptop you need for your studies, or to upgrade your existing model.
If you're in your last year of university, or you've recently graduated, you may need a personal loan to tide you over until you find a job. Luckily, there are personal loans for unemployed applicants available.
Course books/apprenticeship tools
Aside from just laptops, you may need to purchase various course books or supplies for your uni course. If you're doing an apprenticeship, there may also be tools of your trade that you need to acquire.
How will I know if I am eligible for a student personal loan?
Checking if you're eligible for a personal loan is relatively simple. Just make sure you do the following:
- Check the minimum eligibility criteria. Lenders will have minimum eligibility criteria that need to be met before you apply for a personal loan. This is usually to do with your age, employment and income. Some lenders have very tight minimum eligibility criteria and others are more flexible. Before you submit any application to a lender, make sure you meet every minimum eligibility criteria. Finder also lists the minimum eligibility criteria for loans on every review page and in the table below.
- Confirm with the lender if you are unsure. Not sure if you meet one of the criteria? Call the lender or jump onto live chat and confirm with them directly before applying. This is an easy way to avoid a rejection being listed on your credit report later on, which can inhibit your ability to be approved for subsequent loans.
- Consider ways to improve your application. There are many ways for you to improve your application before you apply. For example, a couple of lenders (such as NAB) note on their site that if you open a transaction account with them for a few months before you apply for a personal loan and establish a good history with them, you may have more of a chance of being approved. If the lender you're applying with doesn't offer transaction account products, you could consider building up your savings a bit more before applying or repaying your credit card debt a bit to prove you are a reliable borrower.
How to compare student loans
Before you apply for any student loan, it's important to compare your options to ensure you choose the most competitive one for you:
- How much can I afford? While you may be approved for the loan, keep in mind that ultimately it's up to you to decide whether you can afford the loan or not. Take a look at the rate and the fees, and see how much your repayments will be. If you don't think you'll comfortably make the repayments, you may need to reconsider the loan. Use a personal loan calculator to help.
- Who is the lender? Are they reputable? Can they be easily contacted? Have other customers left positive reviews of their services/products online? The reputation of the lender should inform your decision.
- How much can I borrow? You should also check the loan amount being offered to ensure it will be sufficient for your needs. Keep in mind that the amount you're actually approved for will depend on the criteria set by the lender and your ability to repay the loan.
- How competitive are the rates and fees? Compare the rates and fees you will be charged to other similar loan products and see how they fare. Are they competitive? You want to select the product that will cost you the least, so make sure you're getting the product that's giving you the best deal.
- What are the restrictions? You should familiarise yourself with the terms of the loan to see if there are any restrictions that will affect you. The last thing you need is to take out the loan only to find out you can't use the loan amount the way you wanted, or you can't make extra repayments like you'd planned. Find out what you can and can't do with a personal loan.
Compare personal loans available to students side by side
Just because you are a student, doesn't mean you don't have options available for finance. Compare your options below.
What discounts and eligibility criteria apply to student personal loans?
|Lender||Eligibility criteria||Benefits for students||Review the loan|
|Bank of Melbourne||-||Review|
|People's Choice CU||-||Review|
What to avoid when applying for a student loan
While student loans can offer you a way to access finance that may be needed by you, you should consider your ability to afford the loan before applying. Students are generally on tight budgets, and a loan is a serious and long-term expense to take on. Consider your financial circumstances, compare the options available and decide whether this loan is right for you.
Tuition fees and FEE-HELP loans
When you attend university or an approved higher education provider, you can get a FEE-HELP loan to pay all or part of your tuition fees.
These loans do not cover costs like accommodation, laptops or textbooks.
To be eligible for a FEE-HELP loan, you must:
- Be an Australian citizen and study at least part of your course in Australia
- Be a New Zealand Special Category visa (SCV) holder or permanent humanitarian visa holder and meet the residency requirements – permanent residents can only get FEE-HELP for approved bridging studies
- Have an available HELP balance
- Be enrolled in a fee-paying place at a provider that offers FEE-HELP loans
- Be enrolled in an eligible course at your provider by the census date (your provider can tell you if your course is eligible)
- Submit the Request for FEE-HELP loan form to your provider by the census date
- Maintain a pass rate of more than 50%
For more information on FEE-HELP and managing student debt in Australia, please refer to our guide.
Frequently asked questions
If you have considered the options outlined above and wish to apply for any of the listed personal loans, simply click "Go to site" to visit a lender's website directly and submit an application. Remember to always check the eligibility criteria before applying, and read loan contracts thoroughly before signing on the dotted line. If you are ever unsure about a loan product, or any of the lender's requirements, it's always best to contact the lender directly for more information.
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Personal Loan OffersImportant Information*
You'll receive a fixed rate between 6.99% p.a. and 24.79% 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 of 10.5% p.a.
Apply for up to $50,000 to use for a variety of purposes without needing to add security. Available to self-employed applicants.
You'll receive a fixed rate between 6.99% p.a. and 18.99% p.a. ( 7.91% 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.
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