The features and benefits of low interest personal loans
Our suite of lenders gives you more options to choose from in the comparison process, with more competition leading to more competitive rates.
You can take out a loan for a variety of different purposes, from as little as $2,000 all the way up to $75,000 with a low interest rate.
As part of your personal loan, you also have a say over the size of your low-interest repayments by selecting a term of between one and seven years.
You’ll be able to choose between fixing your already low rate and leaving it variable to potentially experience even lower rates in time.
With free extra contributions to your loan, you can take advantage of your low rate and save yourself hundreds, if not $1,000 or more, in interest.
Tailor your repayments to your needs by selecting between weekly, fortnightly or monthly instalments for your low-rate personal loan.
Interest rates are different for every applicant, so your lender will set you a rate that reflects you as a borrower and your financial situation.
You’ll receive an instant response within 60 seconds after submitting your initial application, with funds sent to you in as little as one day.
Types of personal loan
With an unsecured personal loan, you can potentially borrow as much as $75,000 without the need to attach any valuable assets, such as your car, as security. These loans are the most widely available and often the quickest, with same-day approval possible.
Secured personal loans, on the other hand, make use of collateral. This lowers your risk profile in the eyes of a lender, potentially lowering your interest rate and expanding your borrowing power beyond what you may be able to get through an unsecured loan.
Variable interest rates remain open to fluctuation during your term. This means you can benefit from decreasing rates and save on your loan if the market heads in that direction, although you’ll also pay more if rates start rising.
Fixed interest rates are locked at the beginning of your loan and remain constant throughout your repayments. This acts as a valuable protection against interest rate increases, as your loan will be unaffected, but you’ll miss out on potential drops as well.
If you’re paying off multiple debts at the moment, particularly those with high interest (such as credit card debts), consolidating them into one payment can not only make them more convenient to manage but also potentially save you money overall.
Looking to take off on a holiday with your family but want to pay it off at your own speed? Travelling can be expensive, so you can distribute the cost of your next trip over a period you’re more comfortable with by taking out a personal loan to pay for it.
There are so many costs that go into making your dream wedding a reality, from venue hire to catering to dresses and suits and so much more. By taking out a personal loan, you can start planning the big day you want, even if you can’t pay for it upfront.
Home improvements are desirable for a range of homeowners to help keep their living space fresh and interesting, not to mention increase its value. You can get past the financial hit of renovations with a personal loan paid in instalments.
Personal loans aren’t limited to PAYG employees, though. If you’re running your own business, you can still be approved for financing by submitting tax returns and other alternative documents instead of payslips and utilise your funds however you wish.
There’s a variety of expenses which come with being a student, ranging from the cost of your courses, textbooks and computer to your accommodation. Taking out a personal loan can make these costs more manageable by spacing them out.
Some lenders offer green personal loans, which are designed to be used for energy-efficient appliances and products such as solar panel and air conditioning installation in your home. You can qualify for lower interest rates and fees with this loan.
Why compare personal loans through Savvy?
How to save on interest on your personal loan
Compare your options
First and foremost, it’s important that you give yourself the best chance of finding the loan with the cheapest interest rate by surveying the personal finance market as thoroughly as possible. We partner with a range of lenders who offer low-rate products to borrowers, but it’s not always as simple as choosing the first good one you see.
Taking the time to contrast the best offers and see how they stack up against one another in terms of the total interest cost is the best way to compare your options when looking for low interest loans.
Frequently asked questions about low rate personal loans
More about low interest personal loans explained
What types of personal loans have the lowest interest rates?
In most cases, secured personal loans come with the lowest interest rates. However, there are three main personal finance types to consider when comparing your options, so it’s important to understand the differences between them and how they can affect your interest rate. Fortunately, you can compare offers right here with Savvy and see first-hand which finance types best suit your needs and personal situation. The loans to consider are:
Secured personal loans
Secured personal loans involve putting up an asset as collateral for your finance agreement, which is commonly a vehicle such as a car or another valuable asset. As mentioned, these loans are typically the cheapest in terms of interest rate, so opting for secured finance will often result in the least expensive overall deal.
Attaching your car, another vehicle or your savings as collateral could also substantially increase your borrowing power up to as much as $100,000, with unsecured loans capping out at $75,000. However, because of the need to ensure your asset is suitable to cover the cost of your loan in the event you become unable to pay it off, lenders will often run stringent checks which may eliminate your asset and elongate the approval process.
Unsecured personal loans
Unsecured personal loans are the most common type of personal finance available on the market, with a wider range of lenders (big and small) offering them as part of their suite of products. These can range from as little as $2,000 up to $75,000 and are often able to be approved and funded very quickly, sometimes on the same day you apply.
However, it’s important to understand that these loans can’t usually compete with secured finance. The wider availability and fewer application requirements serve as somewhat of a trade-off in this respect. However, this doesn’t mean you can’t get an unsecured personal loan at a low interest rate. Many lenders offer this product at highly affordable rates to the right customers, so they may end up being the best option for you.
Personal lines of credit
A line of credit is a different type of personal finance from the standard loan structure. While the other loan types involve you taking on a lump sum and paying it off over a pre-determined period, lines of credit act similarly to a credit card. You’re approved for a set limit and can withdraw funds up to that cap whenever you wish instead of managing a large sum all at once.
These are often revolving, meaning they’re able to stay open indefinitely as long as it remains viable for them to do so. Another key benefit is that you’ll only pay interest on the amount you’ve used, rather than the full limit. However, because of the convenience and flexibility that these products offer, you’ll often be required to pay more in interest and fees than either of the other two loan types.
Is the loan with the lowest rate always the cheapest?
No – there are several additional costs which may also be charged as part of your personal loan, so it’s important to keep an eye on these when comparing offers on the market. The two most prominent of these are establishment and ongoing fees. The former is a one-off charge for setting up your loan agreement which can cost up to around $600 in some cases, while the latter is included in your instalments each month and generally cost between $5 and $10. However, many lenders don’t charge either one or both of these fees, which makes them especially crucial to compare.
Some lenders also charge early repayment fees if you pay out your loan ahead of schedule (which vary depending on the size of your loan and the time left to run on your agreement), while all will enforce late payment fees of between $15 and $35. If you wish to compare loans based both on interest and fees, which is always recommended, you should consider a loan’s comparison rate. This is a figure which incorporates both interest and fees to give you a more representative indication of the cost of the loan. However, it only includes regular fees like establishment and ongoing rather than the other conditional charges which may not apply.
How else should I compare personal loans?
It isn’t just interest rates you should look to when comparing different finance offers. There are many other areas that should be factored into your decision making which can improve your chances of securing the right loan for your needs. Fortunately, Savvy makes it simple to compare loan offers from lenders across Australia by bringing all the most important comparison information to you, taking the legwork out of researching different deals. The factors to think about when picking out your ideal loan are:
Not all loans are made equal in terms of the amount you’ll be able to borrow. While unsecured loans can vary from as little as $2,000 up to $75,000 (as mentioned earlier), many lenders will restrict your ability to borrow larger amounts by capping their loans at $50,000. Others will implement minimums of $5,000. It’s for these reasons that you should always ensure the lenders you’re considering can accommodate the size of loan you’re looking for.
Available loan terms
Similarly, although loans can range from as short as one year to as many as seven, different lenders will require you to adhere to a slimmer range of potential terms. There are many personal loans which are capped at five years, which may provide some difficulties for borrowers who are looking to take advantage of the full seven years to make their instalments more comfortable. Others may force you to take two to three years to pay out a smaller loan, which would cost you more overall than if you planned to pay it off in 12 months.
You should always try to give yourself as much flexibility as possible when it comes to how you can repay your debt. Having the freedom to pay above the minimum required amount is one such way to open the door to you saving money on your loan, so you should look for lenders who won’t charge you to do so. For instance, a $30,000 loan at 8.5% p.a. over five years would cost you almost $7,000 in interest but contributing an extra $100 each month would save you over $1,200 and trim ten months off your loan.
Other additional features
If you enjoy the flexibility which extra repayments bring to your loan, you may also enjoy having a redraw facility attached as part of your agreement. These enable you to withdraw funds from the reserve of extra repayments made across your term, providing access to money without requiring you to apply for another loan. However, taking funds away from your principal can result in your loan costing more and taking longer to pay off in the long term. You should also look for loans which accommodate your need for either monthly, fortnightly or weekly repayments.
Helpful personal loan guides
Still looking for the right personal loan?
Personal loans come in all shapes and sizes, so read more about the ways you can use them, as well as how they might work for you.