Get Personal Loans From Bank
How To Get Personal Loans From Bank Lenders
In the past only the main bank lenders provided personal loans and even then they were difficult to obtain. With the deregulation of the banking industry in the 1980's personal loans became much more widespread and it is now much easier to get one. Because there is a greater choice of lenders now it is a good idea to read through the following information and do some thorough research on how to get personal loans from bank lenders.
Who Provides Personal Loans
In Australia today you can get personal loans from any one of the banks and most of the credit unions and building societies. Some of the smaller lenders deal more with secured personal loans than unsecured, so you should check out their websites to see if this is the case. There are also lots of other finance companies that deal specifically with providing personal loans to small businesses and individuals.
It has become commonplace in Australia now to use the services of a finance broker to find the most appropriate personal loan for you from the wide selection of different lenders who provide this type of loan. Now even though a finance broker is supposed to be working for you it is always a good idea to double check their recommendation and ensure that the loan is indeed suitable to your needs. This is because most finance brokers receive a commission from the lender that they recommend. Therefore it is vital you know the amount of this commission and whether all the lenders that they have on their books offer them the same amount of commission.
Main Personal Loan Features
Personal loans do not have as many features are say a home loan. However, because recently in Australia there has been an increase in the amount of competition in the personal loan marketplace there are now quite of number of extra features that you can get. Some of the more important loan features available include :
- AAPR Interest Rate - which is the interest rate including any extra fees.
- Extra Repayments & Redraw Facility - that allows you to payoff the loan as soon as possible but still access that excess money if you need to.
- Choice of Loan Term - to save on interest repayments you should choose the number of years that best suits your ability to comfortable repay the loan.
- Option of Choosing a Fixed or Variable Interest Rate.
- Repayment Flexibility - the option to choose between weekly, fortnightly or monthly repayments to suit your budgeting needs.
Questions When Getting a Personal Loan
Regardless of the type of personal loan you are getting or whether you are getting it from the bank or another finance company there are some important questions that you must ask first. As a bare minimum you should ensure that you obtain detailed answers to each and every one of the following questions.
- What is the personal loan interest rate?
- Is it possible to choose the number of years that I want to pay the loan back over?
- Is it possible to make extra repayments of any amount at any time?
- How can I qualify for a lower interest rate?
- Is the loan's interest rate fixed or variable?
- How much notice will I be given before a variable interest rate changes?
- For fixed interest loans how long is it fixed for and what rate will the loan revert to when that finishes?
- How long will it take for my personal loan to be approved?
- What is the minimum personal loan amount that I have to borrow?
- What is the maximum loan amount that I can borrow?
- What will happen to the loan if I miss a payment by the due date?
- Can I get pre-approved for the personal loan and how long does pre-approval last?
- For my personal loan to be approved what documentation must I produce?
- Can I buy anything I want with my loan money?
- Is there a penalty for paying the loan out early?
- Is there a monthly administration fee on the loan?
- Are there any other fees that I should be aware of?
What you Need to Get a Personal Loan
There are quite a few items that you will require if you want to get personal loans from bank lenders in Australia. These things are generally the same for most lenders, however they can differ from one type of lender like a bank to another type of lender like a credit union. To be on the safe side and to ensure that your loan is processed without any delay you should be prepared to show them the following things if and when they require them.
- During the application process you will have had to estimate what your current living expenses are. Now you may just have to prove this so you should have ready documents showing the amount of rent that you pay, mortgage repayments that you have to make and any other amounts that you pay on a regular basis.
- You may require a letter from your current employer outlining exactly how long you have been working there and whether you are employed on a full time basis. You might also need pay slips that detail how much you earn on a regular basis.
- Lots of documentation that outlines your current financial situation. This will include information about the current assets that you own like a house, car or land, as well as information detailing the state of your liabilities including credit card statements, home loan statements and any other loans that you have.
- You might be required by the bank or lender to prove your identity with a 100 point ID check. To do this you will need to show your birth certificate, driver's licence, bank or credit cards, medicare card or a household bill with your current address on it.
- With most lenders you don't need a deposit to get a personal loan, but I like to think of it as a requiment that you put on yourself. If you can save part of the total cost of the loan then you will not only prove to yourself and the lender they you can afford the loan, but you will also save a lot of money in interest repayments because you need to borrow less.
If you are unsure about the meaning of some of the terms or abbreviations used by lenders then you can check out the personal loan terminology page, which has a detailed explaination about some of the more confusing aspects of getting a personal loan.