A personal loan is a loan of funds made by a bank for personal use. It isn’t a business loan or a home loan and is ideal for buying a car or furniture, taking a holiday or consolidating other debts. Whatever personal expenses you’d like a loan for, a Commonwealth Bank Personal Loan is a simple, hassle-free and fast way to borrow money.
Fixed rate, variable rate, secured loan… what’s the difference?
Fixed Rate Personal Loan.
The interest rate you pay is fixed throughout the term of your loan so that your repayments are the same amount every month, even if market interest rates change. It’s a great option if you’d like to know exactly what you’ll be paying each month.
Variable Rate Personal Loan.
The interest rate is not fixed, so the repayment amount may change. You’ll pay more if the rate increases and less if it decreases. It also gives you more options with the ability to make extra repayments if you come into money, and to redraw on those extra repayments.
Secured Loan.
The lender (in this case the bank or financial institution) takes security over an asset belonging to you. For example, a loan used to buy a car may be secured against that car. So if the loan isn’t repaid the car may be sold to settle the debt. Secured loans usually have a lower interest rate than unsecured loans because the bank has an asset it can use if needed. If there is a shortfall after the sale of the security, you’ll be liable to pay the bank the outstanding loan amount including interest, fees and charges.
Click here to find out which loan is right for you.
Check out our current Personal Loan rates now.
It all comes down to how much you earn (after tax) and how much you spend each month. Usually the more 'spare' income you have, the more you can get. Get an idea by using our Personal Loans Calculator. It'll also help you work out how much you can afford to repay each month.
Then, make sure you're realistic about how much you really need and how much you can comfortably pay back. You might want to consider either reducing the amount you want to borrow, having a guarantor, such as a parent, or extending the term of your loan to reduce repayments.
All forms of regular income are considered when you apply for a loan, including social security payments. Your loan application is based on your individual circumstances, including your ability to make repayments, and your credit history.
A guarantor can help you strengthen your loan application. They will have to sign that they are willing to pay your debts if you miss any loan repayments. Taking on the financial responsibility that comes with being a guarantor needs to be carefully considered, and you should make sure your loan is an amount you can comfortably repay on your own.
If you need some wheels to get around in, check out a car loan where you’ll find everything you need to figure out whether you can afford a Bug or a Beemer. You’ll also find some useful links for valuations and inspections, a loan calculator and information on Car Insurance.
Car loans are available as a Fixed Rate Personal Loan, Variable Rate Personal Loan and Fixed Rate Secured Loan.
*Subject to system availability. You won't be able to get an immediate decision if you are using a guarantor or if your application is incomplete or needs a more detailed review by a lending specialist.