5 reasons you might need a personal loan this summer


2020 has been an odd one to say the least. Whether your travel plans have been cancelled, you’ve rearranged your wedding or home renovation, or your finances simply aren’t what they used to be, a personal loan might help you get back on track. 

It’s true, in some cases it’s more convenient to reach for your credit card to make purchases. But if you have a big expense coming up or find yourself needing to cover a large bill, a personal loan may actually be the better option. 

According to the Mozo database, the average interest rate on a secured personal loan sits at 8.01% and the average unsecured personal loan rate sits at 10.24%. Meanwhile the average credit card interest rate is 16.35%

So, if you think that your situation might be a good one to consider a personal loan, check out some of these examples below. 

1. Buying a car 

With international travel still out of the question and Aussie borders slowly opening up again, what a better time to take a summer roadtrip! 

While buying a car is a big expense and shouldn’t be done on the fly, a loan might help you get on the road toward owning a new set of wheels. 

At the moment the average new car loan rate in the Mozo database sits at 6.45%, while the average used car rate is a slightly higher 7.12%. These types of loans require you to put the car you are buying up as collateral against the loan - meaning the lender can repossess the car if you default on your loan. 

On the other hand, you could opt for an unsecured personal loan, especially if you are buying a used car older than five years. These loans are subject to higher rates, however you won’t have to put up any assets against the loan. 

2. Home renos 

If all this time working from home has inspired you to redo your living room or kitchen, then you may need a personal loan to get you over the line. 

Renovation loans come in all shapes and sizes with options to refinance, top up or set up a line of credit for some extra cash. 

When it comes to personal loans however, there are two you can choose from: a secured personal loan or an unsecured personal loan. Like with a car loan, a secured loan requires you to put up an asset against the loan, in return for a lower interest rate. This could be your home, car or even your savings. Alternatively, there is the option of an unsecured loan where no security is required. 

3. Your big day 

Got a summer wedding planned? If you have a few expenses that still need to be covered, a personal loan may be what you need. 

The benefit of a wedding loan is that if you are splitting it with your fiance, you may have two incomes to help pay it down (lightening the load on both sides). And like other personal loans, you’ll have the option of fixed or variable and secured or unsecured - it’s whatever suits you. 

It’s also important to remember that the shorter the loan the less you’ll pay in interest in the long run. So the golden rule here is don’t go overboard. Ask yourself, is a white carriage and doves really worth it if it’ll leave you in financial strife for months or years to come? 

4. Unexpected medical costs 

The truth is, the unexpected can happen. And in the current global environment medical costs may pop up. 

So what do you do if you are faced with a large medical bill out of the blue? You could apply for a medical loan to cover the costs.

While it might be tempting to slap the cost onto your credit card, a loan may provide a lower interest option on a bigger bill. Medical loans can cover a range of procedures from essential surgery and dental to even elective surgery. 

5. Consolidating your debt 

Have a pile of debt that doesn’t seem to be shrinking as fast as you would like? A debt consolidation loan may be the answer. 

If you have multiple debts across things like car loans, personal loans and even on your credit card, a debt consolidation loan could roll what you owe into one. By doing this, you receive a single (and usually lower) interest rate on your debt, meaning you only pay one repayment rather than multiple across the different products. 

One thing to remember is don’t roll your home loan into a debt consolidation loan. Mortgage terms are usually much longer (around 20-30 years), so this would end up stretching your existing debt out too long. 

Plus, if you only have credit card debt hanging over you, a balance transfer offer may be a better option. This way you can pay 0% in interest for a certain period of time and potentially pay down what you owe quicker. 

Want to start comparing personal loans today? Check out the killer options below or jump over to our personal loan comparison table for even more lenders.

Compare Personal Loans - last updated 9 December 2023

Search promoted personal loans below or do a full Mozo database search . Advertiser disclosure
  • Mozo Expert Choice Badge
    Unsecured Personal Loan


    interest rate
    comparison rate
    Monthly repayment
    6.75% p.a.to 26.95% p.a.
    6.75% p.a.to 26.95% p.a.based on $30,000
    over 5 years

    Borrow up to $50,000 unsecured. Perfect if you earn more than $22,100 p.a. and have good to excellent credit. Multi-year winner of Mozo’s Experts Choice Unsecured Personal Loan Award, 2021, 2022, 2023 & 2024^'

    Repayment terms from 2 years to 7 years. Representative example: a 5 year $30,000 loan at 6.75% would cost $35,430.23 including fees.

  • Unsecured Personal Loan


    interest rate
    comparison rate
    Monthly repayment
    5.76% p.a.to 24.03% p.a.
    6.55% p.a.to 24.98% p.a.based on $30,000
    over 5 years

    Fast, easy and 100% online, this is a low cost loan with no ongoing fees or extra repayment penalties. It's perfect for savvy borrowers with great credit. If you’re over 18 and earn above $30,000, you could qualify (other eligibility criteria may apply).

    Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.76% would cost $35,173.52 including fees.

  • Personal Loan

    Unsecured, Fixed, Exceptional Credit

    interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.
    6.57% p.a.based on $10,000
    over 3 years

    Borrow from $5,000 to $50,000 with a Plenti Unsecured Personal Loan. Flexible loan terms of 1 - 7 years. $0 Monthly, $0 Early Repayment Fees and $0 Exit Fees. Get a rate estimate without impacting your credit score. Once approved, you could receive your funds in as little as 24hrs.

    Repayment terms from 3 years to 7 years. Representative example: a 3 year $10,000 loan at 6.57% would cost $11,340.11 including fees.

  • Debt Consolidation Loan

    interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.to 8.48% p.a.
    7.19% p.a.to 8.84% p.a.based on $30,000
    over 5 years

    Competitive fixed rates on loans up to $75,000 depending on your credit score. Zero monthly account keeping fees, no exit fees and no early repayment fees. Make weekly, fortnightly or monthly repayments, over 1 to 7 years managed entirely online, at any time. Fast and easy, 100% online application.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.57% would cost $35,528.12 including fees.

  • Standard Personal Loan

    Fixed, Unsecured

    interest rate
    comparison rate
    Monthly repayment
    8.99% p.a.
    9.35% p.a.based on $30,000
    over 5 years

    Heritage Bank discounted rates for borrowers with excellent credit. Available loans starting from $5,000 to $50,000. Your choice of loan terms up to five years. Extra repayments allowed, but may incur fees.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 8.99% would cost $37,606.30 including fees.


* WARNING: The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

^See information about the Mozo Experts Choice Personal Loan Awards

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