What is a small personal loan?
Small personal loans ranging from $500 to $15,000 are available from numerous online lenders. These loans are usually unsecured, meaning the issuing of the loan is supported only by the borrower’s creditworthiness with no collateral put forward. Small personal loan lenders have a very similar lending process despite the lending criteria being different between them.
To apply, you will need to visit the lender’s website and complete the online application form. To make a credit decision, the lender will need to receive accurate personal contact information, home address, employment information and bank details. You may also be required to upload supporting documentation such as your latest 3 months’ bank statements. The lender should offer an instant pre-approval decision once you submit your application.
Is a credit check done for small personal loans?
A credit check will be carried out by the small personal loan lender as part of the creditworthiness assessment. The best interest rates are usually offered to customers with excellent credit scores. You may still be approved for a loan if your credit score is lower, however, the loan is likely to be more expensive.
Funding and repayments for small personal loans
When approved for your small personal loan, the lender will instruct the transfer of your funds directly to your bank account. The time taken to receive the money will depend on your banking institution, with the average time to receive cash ranging from the same day to 2-5 business days later. The lender will set up automatic repayments of your loan from your bank account on the agreed upon dates. This makes the small loan very easy to manage as you only need to be concerned with checking you have enough money in your account before each repayment date.
How do I choose a lender for my small personal loan?
Choosing the right small personal loan lender for you will depend on your personal situation. You firstly need to make sure you meet the minimum criteria to be eligible for a loan. If the lender in question only offers loans to borrowers with an excellent credit rating, and yours is average-to-good, you may want to try another provider. Friendly Finance lists the minimum criteria for each lender within their profile to help you with this check. You will also want to review the cost of borrowing.
The representative Annual Percentage Rate (APR) or interest rate of the loan is the best reference point for this. A lender offering a personal loan with low interest rates will likely be the cheapest. Be sure to check for other fees though as they can increase the total cost of borrowing. The primary additional fees to look for are establishment fees and monthly service fees. Again, we highlight all product features and fees charged by the lender to make sure you don’t miss them.
Our site serves as a trusted source of consumer finance information to many Australians. We only work with credible companies, taking the time to understand the small personal loan products and passing this information onto you in a clear and simple manner. Review lenders today and find the money you need!