Is it a good idea to get a loan?

A personal loan can be useful for lump sums between $2,000 and $100,000, which are too big to put on a credit card. It’s also useful because as long as you meet your monthly repayments, you’ll know how long you’ll have debt and approximately how much interest you’ll pay from the beginning.

Do I need to provide security to get a personal loan?

This will depend on the type of loan you apply for. If you apply for a secured personal loan , you'll have to provide an asset, like a car to use as security against the loan. Although this does give your lender the right to repossess your asset if you default on the loan, the good news is secured personal loans typically come with lower rates. On the other hand, if you opt for an unsecured personal loan, you won’t have to provide any security. However, unsecured personal loans usually come with higher interest rates.

What is a personal loan comparison rate?

In our personal loan table at the top of this page, the comparison rate sits to the right of the interest rate and is a quick way of comparing the cost of the personal loan once both the interest rate and fees are combined. The comparison rate is often said to show the 'true' cost of a loan.

Where can you find great personal loan rates?

There’s no easy answer to this question, as it will depend on your financial circumstance and what you’re looking for. So to help you make a decision, we’ve jotted some pros and cons for different types of lenders. Big banks: This includes the big four banks, Westpac, ANZ, NAB and CommBank, plus other major lenders like St George, Bankwest, HSBC and ING. Pros: One of the big benefits of going with a major bank is that you’ll be able to visit a local branch and speak to someone in person if you ever have an issue, which is not the case with some smaller or online lenders. Cons: On the other hand, big banks generally charge higher fees and may not offer the most competitive rate on the market. Credit Unions: An alternative to the big banks are smaller credit unions. These are not for profit organisations that are funded by their members. Pros: Rather than passing profits back to shareholders, credit unions return their profits to their members in the form of competitive rates and fees. Cons: However, to have access to these competitive rates, you'll need to become a member and sometimes need to pay a small fee.

Can I get a personal loan with bad credit?

While you still might be able to get a personal loan with bad credit, it’s not always the best idea as you’ll often be charged super high rates and fees. Thanks to the rollout of comprehensive credit reporting (CCR), many lenders have already begun assessing a borrower’s credibility based on their credit history. In this case, it could be worth repairing your credit history first before applying for a loan.

Are pensioners eligible for personal loans?

Yes, pensioners can take out a personal loan, but it can be tricky to get approved. This is because it’s harder to prove to a lender that you can make your repayments if you no longer have a regular income. If you're struggling to get approval from a lender, you may want to consider Government Assistant Options . However, if you’ve got some extra cash stashed away in an account that can be put towards your repayments, you might be in a better position to negotiate with a lender and have better chances of success.

What happens if my personal loan application gets rejected?

If you've been rejected for a personal loan, it's best not to immediately apply for another. Each time you’re knocked back for a loan it goes on your credit history, potentially making it even harder to get approved next time. The first thing you’ll need to do is assess why you’ve been rejected. Some of the more common reasons include having a: bad credit history low-income unstable employment having too many loans already. These are all things that might impact your ability to repay your loan in the future. Your next step should be to make adjustments to your application to ensure that you aren’t rejected again. This could mean cleaning up your credit history, reassessing your budget and borrowing capacity to make sure you can afford the loan or trying to add a little more to your savings stash.

Are there any personal loan traps to avoid?

The thing to remember about any kind of personal credit is that you'll eventually have to pay the money back. Here are some quick tips to help you avoid some of the biggest borrowing traps: Borrowing more than you need Spending money on other things Being late with repayments Not fully understanding joint loan applicant responsibilities Paying more interest than you need to.

Compare Personal Loans Side By Side | Top Deals for December 2024

Personal loans monthly snapshot: December 2024

JP Pelosi, Managing Editor, December 1, 2024

The economy is still on a bit of a razor’s edge, so few are expecting interest rate cuts from the Reserve Bank in the next three months. Inflation remains top of mind. The Australian Bureau of Statistics puts inflation at 2.1% at the October quarter mark, which, while welcome news for consumers, isn’t the whole story. The annual trimmed mean (or underlying) inflation has risen to 3.5% from 3.2% in October, and this actually represents a jump in inflation overall.

So a lot of items and services are still expensive, including food, beverages and rent, the ABS says. This means many people are still relying on tighter budgets and possibly the assistance of some financial help. For example, a personal loan can be useful in covering a major cost, at least for those with some financial flexibility and good money management skills.

There are good rate options in personal loans generally, because interest rates have held. For example, the average unsecured personal loan rate in the Mozo database is 10.32% p.a. Meanwhile, the average secured loan rate has ticked up a bit to 9.30%.*

Below we list some of the leading personal loan options in the Mozo database.

Let’s get into the leaders in the Mozo database.

Top personal loans in December 2024

If you’re looking for a low-interest rate, here are some of the current lowest loan rates (based on $30,000 over 5 years) in November, 2024 that we track here at Mozo:

Unsecured Loans (excluding green loans):

Lowest variable rate: Community First Bank Home Improvement Loan – 6.54% p.a. (7.60% p.a. comparison rate*) for home renovations
Lowest fixed rate: Harmoney Unsecured Personal Loan – fixed rates from 5.76% p.a. (6.55% p.a. comparison rate*)
Lowest Big 4 (variable rate): ANZ Unsecured Personal Loan (Variable) – 7.49% p.a. (8.18% p.a. comparison rate*)