Personal loans are financial assistance you can apply from a bank or a financial institution to cover for unexpected expenses or payments that may hurt your current financial capacities if paid in cash. You can use Personal loans to finance a vacation, buy a furniture or appliance you need for your home, consolidate debt or educational expense. You can also apply for a personal Loan for unexpected expenses like hospitalization, medicines or to pay for funeral services.

There is no actual limit on how much you can borrow for personal loans. However, it is unusual for a personal loan to be above $100,000. Most personal loans range from $5,000 to $50,000, depending on the policies of your lender and the results of the assessment on your financial capacities.

Personal loans can also be categorized as secured and unsecured loans. Secured loans are like car loans or a mortgage loan that uses your car or your property as the collateral of your loan. Unsecured loans require no collateral.

In applying for an unsecured personal loan, it would be advisable to check these features:

A fixed interest rate allows you to repay for your loan in pre-determined and constant increments throughout your loan. Variable interest rates can be higher or lower, varying from month to month. Variable interest rates change according to the change in interest prevailing in the current market. Choose a type of interest that would work well with your budget, not only today but as well as the rest of your repayment period.

There will be instances where you are put into a situation that may hinder you from paying your personal loans in time. Look for a personal loan that has the flexibility that allows you to pay for your monthly dues in advance or to refinance a loan if you are unable to continue paying. Check for additional charges required for refinancing a personal loan.

Always compare interest rates as well as processing fees. Some banks and lenders charge more than others. You can also use a loan comparison calculator to arrive with the best options possible for your loan.

You will need to provide financial documentation and proofs of identity to be able to apply for a loan from a bank. Some banks and lenders will require a different set of requirements. Here are the basic documents you will need to prepare.

You will need to provide proof of your salary when applying for a personal loan. Payslips should not be older than 60 days for regular employees. Casual employees, on the other hand, should include a YTD amount on their payment proof.

Self-employed employees are required to provide a Notice of Assessment, Tax File Number and 2 months business bank statements.

You will need to submit documents that will prove your identities such as Passports, Birth Certificates, Driver’s Licence, Marriage Certificate, Pensions Cards and other proof of identifications that bank may require.

For unsecured loans, you will also have to provide your Proof of Age card that should be current and not expired. It should be lightened and enlarged 200%, both front and back together with a utility bill for the last 3 months with the same address as you have provided in your application.

Secure a copy of your credit file to be able to check your current financial status and your credit score. It would be ideal to have no default payments and black marks on your credit report to avail a personal loan. However, if you have bad credit, you can still apply for a bad credit loan. It is a type of loan offered by non-conforming lenders.

If you have items in your credit report that are not updated, it would be ideal to have them current prior to filing a personal loan application.

It would be ideal to prepare other financial documents that banks and lenders might possibly look for during the application. If you are paying for a mortgage or any other monthly obligation, it would be ideal to report and inform the bank you are applying for a loan. Secure financial documents ahead to make the process faster and easier.

A personal loan specialist can help you ease the process. You can ask one of Intellichoice’s agents and brokers on how to secure the best possible rates and deals on your personal loan. Visit https://www.intellichoice.com.au/ for more details or call 1300 55 10 45 for more details.