When you take out any type of loan from any of the banks and financial institutions in Australia, your loan approval is accompanied by the trust that the bank or financial institution has given you that you will make your repayment accordingly as scheduled. Calvin Klein Ropa Interior Mujer However, there may be times when due to unforeseen circumstances you are not able to fulfill your end and miss out on a repayment due. Calzoncillos Calvin Klein Baratos What must you do when that happens?
Some surveys made in Australia showed that one in ten Australians have missed a loan repayment due. Bikinis Calvin Klein Baratos While this may ring the alarm bell for the bank or the lending firm that approved your loan, the good news is they are more than happy to help. By informing your bank early that you are not going to make a repayment due to financial difficulty, the more options they can offer to assist you, assess your financial situation help you fix the situation.
Given that, it is also important to know the applicable costs that may be charged to your account for missing out on repayment due as follows:
- Arrears management fee may be charged
- A dishonour fee may also be charged, for rejected cheque payments, or direct debits because of insufficient funds in your account
- A default fee will be charged every time the bank issues a notification for missing out on repayment due date
- Missed payment penalty or late payment penalty will be charged – ranging from $5 to $20 depending on your bank or lender
When you inform the bank of your difficulty in meeting the repayment due, they will ask you:
- The reason why you missed repayment
- How you plan to fix the situation and where the money will come from
- How you think the bank can help you get back on track.
You might not feel comfortable talking to your account officer on why you missed out on a repayment. Calvin Klein Bañadores Hombre But you shouldn’t feel embarrassed because the bank or lending firm understands that financial difficulty can happen to anyone. By taking action and notifying them, you are in essence telling the bank or lending firm that you are trying to fix it the soonest you can but you need their help by giving you a little leeway. This is a positive sign from the bank or lender’s standpoint.
Banks and lending firms can take action if you have missed on more than two repayments without informing or notifying them. They are obliged by certain laws to send out 30 days-notice before they take any legal action against you for failing to fulfill your repayment obligation.
Many of the banks and lenders in Australia also offer hardship programs for borrowers who are in a tight financial situation. Slip Calvin Klein Outlet
So, when you missed out on your personal loan, all you have to do is to inform your financial officer to eliminate any negative thought that can hurt your credit standing.
Being in a position of needing money for an unexpected expense may not be the best scenario one would like to be in. Slip Calvin Klein Outlet But it can happen to anyone, and it can happen to you. When faced with this problem, how are you going to deal with it?
The most likely answer to this is “apply for a loan”. Depending on your financial circumstances, and the purpose for which additional funds are needed, there are different types of loan which you can avail from the different banks and non-bank lending firms in Australia.
Probably the easiest and less troublesome type of loan you can consider applying for is the personal loan. Boxer Calvin Klein Mujer For many residents in Australia, a personal loan can be a great way to address their unexpected financial needs. It may be a purchase needed for a business, or it may be a family emergency expense which has not been anticipated. Tangas Calvin Klein Baratos Having said that, how do you choose the best personal loan for your needs? How do you know which type of loan will best address your needs?
Browse through the list below where different types of personal loans are described in order to see which one can best serve your intended purpose.
Types of Personal Loans
If your purpose for borrowing money is to purchase a new car, you may look into this type of personal loan. Most banks and non-bank lending institutions would not require any collateral for this type of loan because the car itself will serve as the lender’s security for the loan. If you are not able to fulfil your loan repayments, the bank or the lending institution can take possession of your car.
Short-Term Payday Loans
This type of loan will best serve borrowers who are employed, with an urgent need for cash but which their wages cannot sustain at one go. Comprar Calzoncillos Calvin Klein The borrower can then negotiate for a short-term payday loan where the amount borrowed can be repaid in say 2-3 months or even weeks. Boxer Calvin Klein Baratos The loan amount plus fees will be automatically debited from your bank account on payday schedules, depending on the term of the loan.
Unsecured Personal Loans
Some borrowers can access additional funds for their other needs like purchases of furniture, or going on a holiday, or to consolidate debt through unsecured personal loans. The criteria for this is simply find the loan provider with the best and competitive interest rates and fees and flexibility in terms of loan repayment conditions.
Fixed Rate Personal Loans
This type of loan is designed for borrowers who don’t want to take risks in terms of fluctuating interest rates. While this type of loan ensures that the interest rate will not increase during the life cycle of the loan, the borrower loses the opportunity to make savings when interest rates go down. But this loan eliminates constant worrying on issues of increasing interest rates because the loan is tied to a fixed rate until the loan is repaid.
Variable Rate Personal Loans
This is the opposite of the fixed rate personal loans because this type of loan has not assigned a fixed interest rate for the loan, but will apply the prevailing market interest rates instead. This means that the loan repayment amounts will vary depending on the increasing or decreasing interest rates.
Compare the Loans
When you have determined the type of loan that best suits your financial needs, the next step you have to take is to compare the different loan products offered in terms of the best interest rate, the most flexible repayment terms, the longer loan term with option for early repayment without any additional cost to the borrower.
In order to know that you are choosing the right loan facility, you should consider your financial circumstances, your capacity to repay and the urgency of the need for additional finance from external sources.
The ultimate dream of every person is to have his own home where he can start raising his own family. But not all has the capability to buy or build one. Those who cannot afford to build one have another option to fulfill his dream and that is by getting a home loan.
A home loan is a loan that is advanced to the borrower to assist him in buying a new home. Getting this loan is a major decision to make because it involves a significant amount of money. Hence, you need to think about it carefully and thoroughly.
To help in your decision, here are some things that you have to consider before applying for a home loan.
Check Your Current Financial Status
If you are planning to get a home loan you must first check your financial situation and standing. Can you afford the monthly payment without sacrificing any item in the family budget? See if your income can support your monthly installment after regular expenses and taxes. Also consider your source of income whether it is a regular one or on a per contract or commission basis. If it is per contract or commission basis, check if it will be enough to sustain a long repayment period.
Check Your Credit Rating
It always helps to check your credit history as this will determine if you can be entitled to a lower interest rate with lower monthly payment. Slip Calvin Klein Outlet Calvin Klein Bañadores Hombre This will also results in the quick facilitation of your loan. However, if your credit rating is poor you’ll be obliged to opt for sub-prime lending where the interest rate and monthly payment are high.
Check the Annual Percentage Rate
The annual percentage rate or APR is what determines the cost of the home. This is what the borrowers must look for first when applying for a home loan. Calzoncillos Calvin Klein Baratos Make a survey of the different loan providers and look for one with the lowest APR. Calvin Klein Ropa Interior Mujer Since the loan involves a large amount of money, a fraction of the percentage of the APR will mean greater savings for you.
Check the Duration of the Loan
Look for home loans that have shorter repayment terms and with affordable monthly repayment plan. Boxer Calvin Klein España The duration of the loan has a direct effect in the total cost of the loan. Calvin Klein Ropa Interior Mujer The longer the term is, the greater the total cost would be.
Check if the Loan is Secured or Unsecured
A secured loan is a loan that requires giving some assets to the lender as a guarantee for loan repayment. If you default on your payments in a secured loan, the lender has the right to seize whatever assets you put up as collateral. Slip Calvin Klein Outlet An advantage of the secured loan is the lower interest rate that you can get for your home loan.
Check Whether the Rates are Fixed or Variable
Home loans have fixed and variable interest rates. You can choose between the two which you think is comfortable and affordable for you. Calvin Klein Bañadores Hombre Boxer Calvin Klein Mujer Home loans with fixed rates refer to a determined interest rate applicable throughout the loan term regardless of market movements. Home loans with variable rates are dependent on the current prevailing interest rate.
Check the Down Payment
See if you can afford to make a down payment. This will reduce your loan and interest substantially. This will also give you instant ownership of the home.
These are the salient points that you have to know before applying for a home loan.
If you think you are the only one in dire financial need, think again. Bikinis Calvin Klein Baratos At some point in everyone’s life, the need for extra financial assistance do happen. Comprar Calzoncillos Calvin Klein And when you reach that point, what do you do?
You look at the various options available to you and that includes considering the different loan portfolios available in the market. In Australia, both the government and private lending institutions provide assistance by extending various loan facilities and instruments to those who are able to comply with the requirements. Depending on the type of financial assistance you require, a specific type of loan – ranging from home loan, student loan, emergency loan, medical loan, etc., is available to help you get by during the difficult times.
But availing loans don’t stop at getting the approval from the lending firm or the bank. Calvin Klein Ropa Interior Mujer The greatest challenge borrowers have to face is being able to fulfill their repayment obligations. If for instance, you got approved for a dental loan, you need to make sure that you are able to set aside a determined amount corresponding to the monthly repayment amount as agreed upon between the lender and yourself. Boxer Calvin Klein Baratos Every bank, government agency facilitating loan applications, and private financial companies has its own set of policies for loan repayment terms depending on the type and amount of loan availed. Calzoncillos Boxer Calvin Klein Some provide easy and affordable repayment terms while others may have more rigid terms.
Home Loan Repayment Terms
Home loans are also known as honeymoon loans usually offered to first time home buyers. Taken from the concept of “honeymoon period”, borrowers are given incredibly low rates for an initial period of time, clearly designed to get the interest and attention of home hunters. The usual ‘honeymoon period” for the low interest rates is 12 months. Beyond that, the prevailing or agreed market interest rate applies. Most home loans in Australia are approved with 25 to 30 years repayment terms.
Depending on the bank or lending firm, home loan repayment terms may be paid on a monthly, fortnightly and weekly basis. Repayment amount may be calculated to include principal and interest. Tangas de Calvin Klein This means that the principal and interest amount are added together and paid every monthly, weekly or fortnightly, depending on the approved and agreed frequency of repayment. Under this arrangement, the longer the term of the loan, the lower will be the monthly amortization of the loan, making repayment more affordable for the borrower.
Student Loan Repayment Terms
Tertiary students in Australia are usually assisted with their educational loans through the funding of HECS-HELP scheme. Loans extended to students are repaid over time through a supplementary tax, using a sliding scale based on taxable income. Loan repayments are made only when the former student is already financially capable of supporting the repayments. To make it affordable, repayments are not charged with the normal interest rates but it grows with CPI (consumer price index) inflation.
Other repayment terms for students loan approved in Australia include:
- Standard Repayment Plan – This is for a maximum period of ten years for the same monthly payment amount.
- Graduated Repayment Plan – This also is for ten years but the monthly payments will start small gradually increasing at specified intervals.
- Income – Sensitive Repayment – This is for ten to fifteen years. Monthly payments are based on your income level and it is adjusted yearly.
- Extended Repayment – This is for those who have more than $30,000 accumulated loans. Adidas Ultra Boost Femme Pas Cher You can extend your repayment for up to 25 years.
- Income Based Repayment – Under this plan, monthly payments are based on income and family size.
- Income Contingent Repayment – Your monthly payments will be adjusted yearly based on your gross income.
Personal Loan Repayment Terms
This is the most frequently availed loan in Australia primarily because lenders have easy-to-comply requirements for application. Adidas Yeezy Boost 550 Calvin Klein Ropa Interior Hombre Comprar Calzoncillos Calvin Klein Personal loans are paid at an agreed date every month or fortnightly or weekly, depending on the lender’s terms. The longest repayment term for this type of loan is 7 years. Acheter Adidas Ultra Boost Boxer Calvin Klein Baratos Slip Calvin Klein Outlet Other lenders, depending on the loan amount may have shorter repayment period.
Which type of Australian are you? A spender or a saver?
There are two things you can do with your money – spend or save it. For many people, they find spending easier and saving, difficult. Calvin Klein Ropa Interior Mujer This is because spending money is a lot more fun. Chaussure Adidas Yeezy 750 Boost But how can you have fun spending if you have no money to spend?
Everyone knows the importance of saving money but not everyone knows and has the will to save money. This has paved the way for many financial advisers and planners to make their buck by offering their time-tested and proven, effective ways to save money. Boxer Calvin Klein Mujer But the truth is, on your own, you can start saving money if you have the right mindset and objectives to aim for.
Setting Your Savings Goal
There are no secrets to saving money. What’s important is to know your savings goal. Your savings goal will serve as your motivation to stop spending on things that are not really needed. Chaussures Adidas Yeezy Boost 350 There are three types of savings goal, namely:
- Short-term goal. You want to save money on something that you hope to achieve soon, such as purchasing a new pair of shoes or a new DVD player.
- Medium-term goal. You plan to save money for something you want to have within one to five years. It might include something like buying a new car, or going on a grand holiday with your family or friends.
- Long-term goal. You set your mind to save for something you will benefit from, ten or twenty years later. This includes saving for retirement, college education of your children, etc. By saving early, you will achieve those goals sooner.
How Much To Save
After you have determined your savings goal, you have to figure out how much you need to save on a regular basis in order to reach your objective. Bragas Calvin Klein Baratas If your savings goal is to buy a car after a year, you should calculate the amount of money you have to set aside every payday in order to have the desired amount within the timeframe you have set.
Calculate Spending Ratio To Income
Some people tend to set high savings goal because they fail to make the necessary calculations. It’s important to make sure your savings calculation is compatible with your expenses. It’s important to have a record of your spending so that you can have a close approximation of where you spend your money and how much. Tangas Calvin Klein Baratos It will help you to make a realistic savings goal if you know which type of expenses you can reduce or totally eliminate. Comprar Calzoncillos Calvin Klein If you have calculated that you need to set aside 40% of your income to achieve your goal and your current expenditures total 80% of your income, you should adjust either your spending, your goal, or both.
Track and Monitor Your Spending
After knowing the exact amount that you have to set aside every payday, it’s important that you keep track of your spending to make sure that every expense has its corresponding allocation. Some people automatically set aside the savings money so that it won’t be used for other expenses. By tracking and monitoring your spending, you will be assured that you don’t run out of funds before the end of the month.
These are just a few basic tips on how you can effectively save money to achieve your savings goal. Acheter Adidas Yeezy Boost 550 They may work for you or they won’t.
There will come a time when you would have to deal with unexpected big expenses or need for huge amount of money to cover for an emergency situation, and you don’t have enough cash or funds. Calvin Klein Bañadores Hombre How do you deal with that? Do you pull out your credit card to pay for it?
It’s often tempting to be complacent with using the plastic card if you don’t have cash to spend for something you really want but not necessarily need. But if you carefully check your credit card bills, you’d see that they have a higher interest rate for any outstanding balance that has not been fully settled yet with the credit card provider.
If for example, you used your credit card to purchase a flat screen TV for your home, projecting that you can pay it with your income from the extra work you do for the company. Boxer Calvin Klein Al Mayor What if the company asks you not to do extra work anymore? How can you pay for the monthly installment of the flat screen TV? What you will see next on your credit card bill are interest charges, services fees and other charges incurred for failure to pay the bill in full.
In such a case, another option is available – personal loan. Unlike credit cards, consumer or personal loan has a predetermined fixed repayment amount and schedule. The repayment amount includes the interest charged on the borrowed amount.
On the other hand, credit cards don’t have a fixed or determined time frame to settle outstanding balance. Calzoncillos Boxer Calvin Klein They have credit limit which you can use in your desired amount within the set limit. Ropa Interior Masculina Calvin Klein Baratos Credit cards can provide usage convenience but in terms of costs, a personal loan will prove to be a more practical and wise choice.
If your borrowing needs is only for a few hundred to a few thousand dollars for a one-time purchase or expense, a personal loan offers a better interest rate than the interest rate on a credit card.
In addition, personal loan may be repaid in weekly, fortnightly or monthly installments. Bikinis Calvin Klein Baratos You can also negotiate the loan tenure, depending on what is suitable for you. Boxer Calvin Klein Baratos If your repayment amount every month will eat up a good chunk of your budget you can negotiate for a longer repayment period.
Credit cards can easily lure users to be stuck in the minimum payment trap, with payment money going mostly to service the interest and a small portion to service the principal amount borrowed.
So which one would you prefer – personal loan or plastic?
Below are three reasons why you should go for personal loan:
- Stability provided by fixed rate interest. A personal loan provides you with a lump sum of money with the option to pay it back over a determined time frame. Under a fixed rate personal loan, you don’t have to worry about any increase in interest rates that will subsequently increase the repayment amount.
- Easy to Manage. Fixed rate personal loans are easy to budget and manage.
Financial difficulty can happen to anyone, especially to those who have not financially prepared for emergency cases or unexpected expenses. Calvin Klein Ropa Interior Mujer At some point, some of us may be faced with financial circumstances that would compel us to turn to others for assistance and help.
In many of these cases, the numerous banks in Australia as well as the non-bank lending firms provide help by offering different types of loans to those who have an urgent need for additional funding. Comprar Calzoncillos Calvin Klein The most common and perhaps the most sought-after loan type is the personal loan. Calzoncillos Boxer Calvin Klein To know personal loan in full details, you can refer to our previous article here.
What are the requirements for applying for personal loan?
Loan Requirements Checklist
Most banks in the country require the following criteria to be met by any applicant for a personal loan. Boxer Calvin Klein Baratos The applicant must be:
- At least 18 years of age
- A resident of Australia
- With a regular source of income
- With good credit rating
- With the need to borrow at least $5000
If you are not an account holder of the bank where you are applying for a personal loan, you would need some evidentiary documents to prove your identity, such as:
- Passport, or
- Australian driver’s or firearm’s license, or
- Proof of age card, or
- Birth certificate, or
- Citizenship certificate, or
- Pension card or health care card, or
- Council rates or utility bill for Australian Taxation Office assessment notice or overseas driver’s license
Similarly, the following documents may still be required by the bank or other lending firms:
- Proof of income – most recent payslip for employed applicants
- Bank statements showing wages credited into the account for a period of three months prior to application date
- For retirees, proof of rental or investment income or pension credited to account
For self-employed applicants, you need to prepare the following documents:
- Financial statements for the past year; the financial statements must not be older than 18 months at the time of application
- Personal/Business Tax return for the latest year of operation (not older than 18 months)
If you derive income from other sources like Rental Income, you need to provide the following:
- Signed lease (current or new)
- Most recent tax return
- Rental credits to the account (bank statements or transaction history) for the past 3 months
- Most recent rental statement
- Real estate agency later
- Shareholding statement
- Tax returns for the last two years
List of Liabilities
It will also help if you can provide a list of your liabilities which may include:
- Current loan statements for the past 3 months
- Credit and store card statements
- Personal insurance documents, including:
- Home and contents insurance
- Investment property insurance
- Income protection
- Term life
- Total and permanent disablement
These requirements differ from one bank to another or from one private lending firm to another.
You already know that several banks and non-bank lending institutions offer personal loans so in the event that an immediate need for extra cash arises, you have that option available.
But first, you might as well spend some time to do your due diligence and get as much information about personal loans. This way, when the time comes for you to take out a loan, you are equipped with enough knowledge and information about the mechanics, terms and conditions, limitations, etc. of a personal loan.
While personal loans are generally classified as unsecured loans, there are forms of personal loans that fall under secured loans. Each bank or personal loan lending firm has their own set of rules, requirements and policies on the approval of personal loans. Try as much as possible to check the details of the terms and conditions of each lender in order to select the lender that offers the best deal.
Secured Personal Loans
By secured, it means that the personal loan has to have a property or asset pledged as collateral for loan repayment. A common example of a secured personal loan is a secured car loan. Comprar Bragas Calvin Klein If you buy a car, you can approach the bank or other lending firm for a secured personal loan in which the car will be used as collateral for the amount borrowed to pay for the purchase amount of the car.
For this type of personal loan, the bank or lending firm needs an assurance that the borrower is in a position to repay the borrowed amount. Calzoncillos Boxer Calvin Klein In a secured car loan, the lender can seize the car from the borrower in the event that the borrower fails to honour their obligation to repay the loan amount.
If you own a house and you apply for a personal loan, you may use your home as collateral for the loan. Boxer Calvin Klein Baratos In this case, the borrower is given a home-equity loan, where the lender has the right to sell your home and use the proceeds to pay for whatever amount is left unpaid.
The borrower’s gain from a secured car or home-equity loan is a lower interest rate compared to the interest rate charged to unsecured personal loans.
Unsecured Personal Loans
For this type of personal loan, the borrower is not required to pledge an asset as collateral or loan guarantee. Bragas de Calvin Klein The bank or any personal loan firm in Australia initiates their set of screening and verification procedures to assess the credit history of the borrower. If satisfied with their findings, the lender will approve the loan.
But because there is no collateral, the unsecured personal loan has a higher interest rate than secured personal loan. The lender takes more risk without collateral and as such, the bank compensates that risk with a higher interest rate. Further, because there is no collateral or property or asset pledged against the loan, the consequences are immediate if the borrower fails to fulfill his loan repayment obligations.
One type of unsecured personal loan is the signature loan offered by banks and credit unions throughout Australia. This loan is secured by the borrower’s signature alone – and the promise to pay. It’s more like an instalment loan that amortises over a specific time frame. This means you can borrow once and agree to pay a fixed monthly payment until the loan amount including the interest is fully paid.
Other banks and lending firms also offer credit cards. Calvin Klein Ropa Interior Mujer This is another common and popular loan type which most Aussies avail because they make borrowing easy. Slip Calvin Klein Outlet Once you are approved for a credit card, you can borrow practically up to the approved credit limit, and almost instantly. But borrowers should understand that credit card loans charge very high interest rate despite adverts or teasers that claim otherwise. Hence, this is not a recommended loan type option because it’s so easy to quickly end up paying hundreds of dollars in interest costs alone. Bragas Calvin Klein Baratas If you plan to avail this type of loan, you should be able to manage it properly such that you don’t accumulate unpaid amounts that accrue high interest rates every month.
Choosing The Right Personal Loan
It’s really important for you to carefully analyse your financial needs and current financial capability before approaching a lender for a personal loan.