Different Types of Low Interest Personal Loans for your Needs

People apply for a personal loan for different purposes such as home improvements, debt consolidation, or many other reasons. Sometimes, finances or money might hold you back from fulfilling your dreams and achieving the things you desire in life. But you can fulfill them with the help of a personal loan. As an applicant, first, ask yourself how much personal loan do I qualify for before applying for the loan.

Easy and Convenient Low Interest Personal Loans

Personal loans can use for different purposes like debt consolidation, large purchases, or emergency expenses. The main attraction of such low-interest personal loans is that borrowers can pay back the money in monthly installments. The process of getting low-interest personal loans is pretty simple and easy, and you can choose a secured or unsecured loan for your needs. Take advantage of an online personal loan calculator if you want to know ‘how much personal loan can I get on my salary’.

Rate of Interest

Most personal loan rate of interest is almost fixed. So, the amount you pay every month will stay the same. But it can vary depending on the companies that offer loans. It can be fixed interest rate or variable, and fixed loans are better for large purchases because they can have better-structured repayments. And usually, these loans come without any collateral, and if you do not qualify for an unsecured loan, you can try to get it by using collateral. You can also try to get it approved by asking a family member or friend to co-sign on your personal loan. But check yourself how much personal loan I can get before making the processes.

Get an Idea of Different Types of Personal Loan

If you plan to apply for a personal loan for a wedding, home renovation, for a holiday, or paying off your debts, you must have an idea about different types of loans. Sometimes, you need money urgently for the education of your child or for medical emergencies. Get an idea about how many types of personal loans are available. It helps you to make the right choice for fulfilling your needs. The most common types of personal loans available in Australia are:

Secured loan
It is the most common type of personal loan, in which you can secure a loan against something you own. That means you give collateral, and the lender can seize it if you default on the secured loan. You can give your property, vehicles, term deposit, or high-value assets like paintings or jewelry as collateral in this case.

Unsecured loan
In this case, you can get a loan without putting up anything as collateral. But the personal loan rate of interest is relatively high in this case. The lender can take legal action against the borrower even if they do not give collateral for default on the loan. Since its interest rates are high, these types of loans are pretty easy to get.

Line credit loan
This pre-agreed limit of borrowing is almost similar to credit cards you can use at any time, even if it has a high-interest rate. Line of credit loans is very convenient because it gives access to the funds whenever the holder needs them. But they charge interest only on the funds the borrower actually uses.

Debt consolidation loans
It is also a type of personal loan which allows you to combine your other debts to make it a single loan. You can combine all debts in a single place, but you might stretch your short-term debts into long-term loans.

Overdrafts
It is a type of line of credit beneficial to cover unexpected expenses you can attach with your usual transaction account. Overdrafts give an increase in your bank account balance temporarily and come with interest. But the positive part of overdraft is that banks charge interest only for the amount you use in a given month. Before applying for overdraft, consider how much personal loan I can get from other sources.

Student loans and guarantor loans
Students in Australia can take advantage of this type of personal loan, which helps them pursue a good education. Many banks and lenders offer students loans, and even some banks do not charge application fees for this type of loan. But the personal loan rate of interest starts accruing from the date the student takes out the loan. Students who find it difficult to meet repayments can apply it with a guarantor. A guarantor can be a guardian or parent, and the security of a guarantor helps students get access to a lower rate of interest.

It would be better to think ‘how much personal loan can I get on my salary’ before applying for a personal loan for your emergencies. You need money for different purposes like to pay for weddings, home renovations, or buying a car. With a personal loan, you can get a specific amount of money for your particular needs. And repay the money over an agreed timeframe with interest. A personal loan comes with a fixed or variable interest rate. You can also opt for a secured or unsecured loan.