As a borrower, there are various ways in which you can borrow money. For example, to buy a house you may take out a mortgage, where the loan amount is paid directly to the seller from the lender. For everyday spending you may use your credit card. This typically involves the lender paying the vendor directly for your purchase. Unlike the above forms of finance, a personal loan is a form of cash loan. This means that the loan amount will be deposited into your bank account as cash! So no expensive cash advance fees, no expensive cash advance rates, you are rewarded with a personalised rate that could be as much as 8.05% p.a. (9.06% Comparison Rate)
So when would you use a personal loan over say, a credit card?
A few key times spring to mind:
(1) For any cash purchase, such as paying a brickie for home renovations or travel money;
- (2) For any large purchase (e.g. > $5,000) that you may want to pay off over time. In this instance obtaining a low rate personal loan, instead of using your credit card, may mean you’ll pay less interest over time. Large purchases can include buying a new or used car or paying for a wedding; and
- (3) To consolidate debts. If you currently have a large amount of debt outstanding (e.g. > $5,000) on high interest finance products like credit cards then you should be thinking about refinancing these debts into one, easy to manage, fixed repayment, personal loan. You can do this by completing an online loan application here. All applications are 100% online, meaning no printing, no paper, no fuss. All approvals are provided the same day of application and you could have the funds in your account the same day, it is that simple.