Is a personal loan right for me?

A personal loan might make sense for you, if have other expensive loans that you want to consolidate, or if you need to pay for a big-ticket item that you haven’t budgeted for. Personal loan interest rates are usually lower than credit cards if you have a good credit history, however it can be hard to make sense of what the loan will actually cost you.

What will it cost, and will it impact my credit?

A review of financial comparison site Mozo as of November 2019, shows one lender advertising a rate of 6.99%, but notes the comparison rate for the same lender can be as high as 29.55%.There are two main reasons for this massive disconnect between the advertised rate and the actual rate you end up with as a consumer:

  1. lenders often advertise their ‘best rate’, which often only a tiny fraction of customers can access. This ‘best rate’ is often very different to the rate you are likely to see as a consumer.
  2. personal loans often include ‘application fees’, ‘upfront fees’ and even ‘monthly fees’ and other costs buried in the small print, which often means you end up paying far more than the advertised headline rate.

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This can make it hard to know the real cost of what you are applying for, which is a big deal considering that even simply applying for a personal loan can leave a mark on your credit history (yes, even if you don’t end up taking the loan!).

The other factor to consider is the minimum loan term. Many lenders have minimum loan terms of 3 years, which might make sense if you want to spread the repayments out over a long period of time, but be aware that by doing so you will pay interest for a longer period of time and therefore the loan will cost you more.

What’s involved in getting a personal loan?

To work out if you qualify for a personal loan, the lender will check your income and expenses to determine if you can afford the loan and the repayments based on their lending requirements and contingencies. Sometimes this is straightforward, but often even determining your ‘income’ becomes complicated if you are self-employed, approaching retirement age, or have investment income to consider? On the expenses side it can be just as complicated – if you recently went away on holidays and had higher expenses than usual, should the lender assume you will keep spending this way? These are some of the complexities associated with borrowing money that can make it a painful experience.

The lender will also check your credit, which can leave a mark on your credit file even if you don’t end up taking the loan.

Is there a better alternative to personal loans?

If you’re a property investor, then the answer is yes! At FutureRent, we believe there should be a simpler way for property investors to get up to $60,000 without borrowing money. FutureRent doesn’t lend money, so we don’t need your income or expenses. We also think you should know exactly what it’s going to cost you upfront and that this cost should never change. If you’re a property investor and after a simpler, faster and more consumer friendly solution, find out more at

Disclaimer: Please note that the information on this page is general information only and should not be taken as constituting professional or financial advice. FutureRent is not a financial adviser. You should consider seeking independent legal, financial, taxation or other advice to check how the information on this page relates to your unique circumstances. FutureRent is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this website.