Personal Loan Eligibility – Monzi’s A To Z Guide

Establishing your personal loan eligibility is crucial before you apply for a loan. However, if you’re new to the game, you may not know what requirements you must meet. Luckily, Monzi’s here to break it down for you. Read on as we investigate what you can do to ensure that you are eligible before you apply. Let’s go.

Please note, certain ideas and products presented in this article may not be offered by Monzi nor the lenders we work with. This article presents only general information. Consider seeking professional financial, taxation, legal or other advice to check how the information and ideas presented on this website relate to your unique circumstances.

What does personal loan eligibility mean?

Personal loan eligibility is simple. In short, it refers to your suitability for credit.

As a rule, all lenders will provide a range of criteria that borrowers must meet before applying. These criteria may relate to your age, income, residency status and a host of other factors. In most cases, the criteria will directly correlate with your ability to afford your loan.

Given this, before applying, it’s essential for you to confirm that you meet the lender’s requirements. If you fall short in one or more of the necessary categories, your application may not be approved. So, it’s always better to know beforehand.

So, what do we mean by ‘personal loan’?

In short, personal loans are a quick and simple cash option to cover personal expenses, from an unexpected cost to a dream that is just out of reach. However, finding a lender can sometimes be a nightmare. But fear not, that’s where Monzi comes in! Our lender-finder service is designed to pair you with a top-notch available lender, so you don’t need to do any of the heavy lifting!

How do personal loans work?

Personal loans function just like any other loan. You borrow money online from a credit provider and reach an agreement on the terms of your repayment. The borrower typically repays their loan in weekly, fortnightly, or monthly instalments until the balance of the loan has been paid off. This repayment term normally ranges from several months to several years, depending on what terms the lender offers.

Your repayments will generally consist of the original loan amount, as well as any interest and fees incurred. These repayments often occur through a direct debit from your account. As a result, they’re automatic­­. You don’t even have to lift a finger!

Are there different kinds of personal loan?

Monzi understands that everyone is unique, so your loan should be too! Fortunately, there are many credit options out there. Some types of personal loans include:

Secured loans

A loan that allows you to offer an asset as security in exchange for potentially lower rates or even larger loan amounts. Assets may include your car, motorbike, boat or caravan. These loans can be secured through either a purchase you intend to buy, or a purchase you already own. If you fail to repay the loan, the lender may repossess your asset.

At Monzi, we may be able to pair you with a lender offering secured loans from up to $10,000. However, note that approval is not guaranteed.

Unsecured loans

A loan that is not secured by one of the borrower’s assets. As lenders are unable to repossess an asset, they may charge higher fees and rates on the loan. Moreover, lenders typically only offer unsecured loans for amounts up to $2,000.

Car loans

As you may have guessed, car loans are used to purchase a vehicle. You typically can choose to use the car you intend to buy as security for the loan.

Line of credit

A loan that provides you with access to a set credit limit, but you only pay interest on the funds you actually use. This kind of loan might be a good choice for those wanting to merge multiple debts or fund a range of purchases.

However, keep in mind that Monzi cannot pair you with a lender offering these products. As a result, you must do your own research.

Debt consolidation

A loan that combines multiple debts into a single amount. This kind of loan might be a good choice for those overwhelmed by several loans. After all, you’re left with one simple loan, rate and repayment schedule. At Monzi, we may be able to match you with a lender offering loans for debt consolidation from $300 to $10,000.

Before applying though, ensure that debt consolidation is right for you. Consider the costs associated and ensure that you will not be paying more by taking out a debt consolidation loan.

Overdraft

A loan that is similar to an unsecured loan, but is generally connected to your everyday bank account. This kind of loan might be a good choice for those looking to access additional funds once they have exhausted their own.

Bad credit loans

A loan for borrowers without perfect credit. In other words, those who may have missed past repayments, defaulted on a loan, or declared bankruptcy. Fortunately, there are still options available to you. However, it is helpful to remember that this kind of loan may involve higher interest rates and fees.

At Monzi, we work with several lenders who may be a little forgiving when it comes to your credit history. While approval is not certain, they may assess more than just your credit history to determine your outcome.

Make sure you check your personal loan eligibility before applying to the one that suits you.

What are the benefits of a personal loan?

Personal loans can be helpful if you are dealing with an emergency expense or looking to make a special purchase. You may be eligible to borrow any amount between $300 and $10,000, depending on your personal situation. A personal loan may be an option for you if the particular loan:

  • Meets your objectives and needs; and
  • Is reasonably affordable for you to make regular repayments.

Some benefits of choosing a personal loan may include:

  • Flexible terms;
  • Quick and easy applications;
  • Receive the money in your account soon;
  • Fees and charges are capped by ASIC;
  • May be used for a variety of expenses; and
  • May be an option for borrowers with bad credit.

What are the disadvantages of a personal loan?

Monzi knows that everyone is different, and a personal loan may not be right for you. Some drawbacks of personal loans include:

  • Bad credit loans may attract higher fees and rates;
  • They may be expensive; and
  • Debt may accumulate and damage to your credit score may occur.

Is a personal loan right for me?

There are many factors to consider before applying for a personal loan. These may include:

  • Your income, savings, and assets
  • Your day-to-day expenses
  • Any current debts you have
  • Any upcoming expenses you will face
  • Ways you might be able to minimise your overall costs, in order to reduce the amount you need to borrow

You must also check your personal loan eligibility by seeking out an estimate of your repayments prior to applying for a loan. This way, you will know if you can afford to repay what you intend to borrow.

Once you have received an estimate of your repayments, compare the factors listed above with the value of this estimate, and assess whether a personal loan would still be a good choice for you. It may even help to discuss your situation with a qualified financial advisor, prior to applying for the loan.

How do I check my personal loan eligibility?

If you are unable to discuss your options with a financial advisor, there are many other ways to check your personal loan eligibility. Personal loan calculators may be useful in helping you figure out what you can afford to borrow, and what the repayments might be.

In addition to this, most lenders will list their eligibility criteria on their website. However, note that simply being eligible does not mean that your application will be approved.

Personal loan eligibility and Monzi

While Monzi may not be able to offer you the cash you need, our lender-finder service can make it simple. Apply today and you may be paired with a lender in just 60 minutes.

However, before you apply, be aware that you must meet a number of criteria to be eligible.

  • At least 18 years of age.
  • Australian citizen or permanent resident.
  • Have a current contact number and email address.
  • Possess an online bank account with at least three months of income and transaction history.

Your application may not progress if you fail to meet any of the above criteria.

What is a personal loan calculator?

A personal loan eligibility calculator is a useful financial tool for those considering applying for personal finance. Based on the terms of your ideal loan, the calculator provides you with an estimate of what your loan repayments might be. You can then decide whether that loan suits your personal budget and terms.

This will generally involve you entering loan details such as the loan amount, interest rate, and repayment period in order for the calculator to determine what your routine repayments might be.

However, it is important to note that these values are only an estimate. This means that they are non-binding and used only for display purposes. Ultimately, your lender will determine what your repayments are.

Personal loan calculator: bad credit

Do you have poor credit? A history of missed repayments? Fear not— you may still be able to access a personal loan through our range of online lenders.

While many lenders may check your credit score, that’s only one step in the process. Lenders will do their best to determine what repayments may be affordable for you. This will be based on your income and outgoing costs.

If you are currently in a stable financial position, it is possible that you may be offered a loan in spite of your credit history.

However, it must be noted that loan approval is at the lender’s discretion and that loans offered to customers with bad credit may incur additional fees or higher rates. This is generally to account for the risk that lenders face when offering personal loans to borrowers with poor credit. These factors may not be taken into consideration by personal loan repayment calculators, so try not to assume your personal loan eligibility and explore your options with caution.

personal-loan-eligibility-checklist

Personal loan calculator: secured vs. unsecured

There are two main types of personal loan: secured and unsecured. The key difference is the use of security against the loan.

In a secured loan, the borrower must nominate an asset as security in order to finalise the loan agreement. This asset, which usually takes the form of a vehicle, is used to guarantee the loan. In other words, if the borrower defaults on their loan, the lender may recover their losses by repossessing the nominated asset.

In contrast, unsecured loans require no security, but may have higher interest rates and fees than secured loans.

Make sure that you check your personal loan eligibility prior to selecting a specific loan.

Personal loan calculator resources

Not sure where to start? Luckily, there is no shortage of online personal loan calculators. With one search, you’ll be able to access numerous free resources that can assist you in calculating your personal loan repayments.

However, a good place to start might be the Australian Government’s Moneysmart loan calculator. This resource will not only enable you to determine your personal loan eligibility, but may even calculate your regular repayments, how much you can afford to borrow, and how.

In addition to this, the Moneysmart website provides a range of handy financial tips and legal information. So, make sure you read it before applying.

On the other hand, Monzi’s loan slider at the top of this page can also help you determine your personal loan eligibility. Simply drag the slider to set your preferred loan amount and select your ideal repayment period. You will then be offered an estimate of your regular repayments may be. However, any outcomes are only a guide, and actual repayment values may vary depending on your lender.

How should I compare personal loans?

Monzi understands that everyone’s personal situation is different, and their personal loan should reflect that. So, potential borrowers need to compare their options before making a final decision on which loan is right for them. When comparing your financial options, ensure that you take into account:

  • The amount you intend to borrow.
  • Your preferred repayment term
  • The interest rate applied to your loan
  • Additional fees and charges attached to your loan
  • The features that apply to your personal loan
  • The reviews of different lenders offering personal loans

It is important to note that these factors can vary depending on the lender you’re paired with and the type of personal loan you choose. For example, the terms of a minor loan (e.g. up to $2,000) may differ from that of a secured personal loan.

Monzi’s Top 10 Bucket List Experiences in Australia

Feeling a little restricted? Breakaway from the day-to-day and experience the hidden gems that Australia has to offer. Here are Monzi’s top 10 bucket list experiences in Australia.

Snorkel and dive in the Great Barrier Reef, QLD

As a natural wonder of the world and the largest coral reef in existence, why wouldn’t the Great Barrier Reef be on your bucket list? Whether you’d prefer to snorkel on the surface, or deep-dive into every nook and crevice, the reef provides an endless array of colour, coral and creatures of the deep.

Surf the waves at Bondi Beach, NSW

Bondi Beach is not only Australia’s most famous beach, but the filming location of the popular TV show, Bondi Rescue! Known for its ‘ripper’ waves and sunny skies, this sandy hotspot is located a few kilometres from Sydney’s CBD.

Climb the Sydney Harbour Bridge, NSW

This heritage-listed arch bridge is not only an iconic symbol of Sydney, but of Australia itself. From the top, you’ll get a first-class view of the nearby Sydney Opera House, harbour and surrounding city.

Four-wheel driving on Fraser Island, QLD

If you’re a 4×4 enthusiast and love life in the fast lane, the shores of Fraser Island are ideal for you. Stretching over a length of 123km, Fraser is the largest sand island in the world and perfect for hitting the shores with your mates in your favourite four-wheel drive.

Treat yourself to the Whitsunday Islands, QLD

With crystal clear water and bright white beaches, the Whitsunday Islands are the perfect place to relax. Whether you love sailing, snorkelling, cruising or sipping on cocktails, visitors agree that the Whitsundays are unmissable.

Chill out in Byron Bay, NSW

This beachside town has legendary status across the world. It attracts surfers, hipsters, backpackers, and even celebrities like Chris Hemsworth, Zac Efron, Matt Damon and Olivia Newton-John. If you’re looking to immerse yourself in picturesque hinterlands and relaxing beaches, Byron is the place to be.

Catch the sunset over Uluru, NT

Recognised as the ‘heart of Australia’, Uluru’s Ayers Rock is so much more than a giant rock. Not only does it have immense spiritual significance, but the 600 million-year-old landmass attracts visitors from all over the world with its ochre red colour and vibrant sunsets. A must-see sight for anyone and everyone!

Shop ‘til you drop in Melbourne, VIC

If you’ve got a passion for fashion, Melbourne should definitely be on your bucket list! From Melbourne Central and Chadstone to Collins and Chapel Street, every alleyway has their newest and finest designer threads on show. However, if you’re more into sports than shorts, Melbourne is also home to some of the most-watched sporting events across the nation, including the Australian Open Tennis, Melbourne Cup, Grand Prix, and AFL.

Watch turtles hatch in Bundaberg, QLD

While it’s known for sugar cane farms and Bundy Rum, Bundaberg is also the best place to be during turtle season. From October until April, get a glimpse into the natural wonder that is turtle nesting and hatching on Mon Repos Beach. Every year without fail, our tiny hard-shelled friends make the dangerous journey toward the ocean and their adolescence. Truly a spectacular sight!

Take a safari through Karijini National Park, WA

If you love the great outdoors, you’ll be infatuated with Karijini National Park in Western Australia. With popular features like Fortescue Falls and Mount Bruce, travellers can expect to encounter native wildlife, natural spas, walking trails, rock pools, and swimming holes. Though some may describe it as the road less taken, you’ll certainly want to take it again and again!

What if I can’t afford to travel right now?

If you’re dreaming about a holiday or just looking to break away from the daily grind, a personal loan might be right for you! Luckily, we are here to help. Monzi is a lender-finder service run by Aussies for Aussies. We make it our mission to connect people from all over the country to the loans they need.

What is a joint personal loan?

A joint loan is a type of personal loan that two people in a relationship may apply for. A joint personal loan might be an option for a couple looking to purchase a new car, renovate their home, or even fund their dream wedding.

The couple must typically be married or in a de facto relationship, and live at the same address. If approved for the joint personal loan, the couple is recognised as co-borrowers. This means that both people are equally responsible for repaying the loan.

However, be aware that Monzi cannot accept applications for these loans. Instead, we only work with lenders who may offer fast cash to borrowers.

What should I consider before choosing a joint personal loan?

Prior to applying for a joint personal loan, you should consider the personal loan eligibility of yourself and your partner. To determine your combined personal loan eligibility, you should consider a few factors:

  • Both applicants must fulfil the criteria for a joint personal loan.
  • If approved, you and your partner will assume equal responsibility for repaying the loan.
  • You may be eligible to receive a higher loan amount when applying for a joint personal loan. However, it is best not to take out a larger loan than you need or can afford, even if approved to do so.
  • A joint personal loan is an important commitment. So, consider all factors before applying.

What are the benefits of a joint personal loan?

There are many positive sides to applying for a loan with your partner, including:

  • Increasing your chances of personal loan eligibility and approval
  • Sharing an asset
  • Possible eligibility for a larger loan
  • Consolidating large or multiple debts

How do I know if I am eligible for a joint personal loan?

The criteria for joint personal loan eligibility can vary greatly and may depend on a number of factors, including:

  • The lender you apply with;
  • Income of each partner;
  • Age of each partner;
  • Credit rating of each partner;
  • Ongoing financial obligations of each partner;
  • The residency status of each partner.

How can Monzi help me?

Do you think a personal loan might be an option for you? Apply with Monzi today! We are a lender-finder service who make it easier for you to find lenders online. As a result, you can focus on the important things in life.

Through the lenders we’ve partnered with, you may be able to access quick cash amounts from $300 to $10,000 in a matter of minutes. With an easy online application process, Monzi is the safe and simple choice.

Scroll up and apply today!

Factor In

Costs

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You won't use a penny to apply for our lender-finding service, but here's some costs you could expect from a lender

Loan amount

$300 - $2,000

Terms

12 months

Costs

20% upfront establishment fee

+ 4% monthly fee

Example

Loan Amount of $1,000 over 6 months repayable weekly (25 weekly repayments). $1,000 (Principal Amount) + $200 (20% Establishment Fee) + $240 (fees based on 4% per month over 25 weeks) = $1,440 total repayable in 25 weekly installments of $57.60.

Under the current legislation, most small personal loan providers don’t charge an annual interest rate (you’ll know this as an APR) %. The maximum you will be charged is a flat 20% Establishment Fee and a flat 4% Monthly Fee. The maximum comparison rate on loans between $300 and $2000 is 199.43%. This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate

Loan amount

$2,001 - $4,600

Terms

13 months

24 months

Costs

48% annual percantage rate

67.41% comparison rate p.a.

Example

Loan Amount of $3,000 over 18 months repayable weekly (78 weekly repayments). $3,000 (Principle Amount) + $400 (Establishment Fee) + $1,379.06 (reducing interest) = $4,779.06 total repayable over 18 months with weekly installments of $61.27.

The Interest Rate for Secured Medium Loans is 48%. The Typical Comparison Rate is 67.41% p.a. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate with the lender that finances your loan. Click here to see a worked example.

Loan amount

$5,000 - $10,000

Terms

13 months

24 months

Costs

21.24% annual percantage rate

48% comparison rate p.a.

Example

Loan Amount of $10,000 over 24 months repayable weekly (104 weekly repayments). $10,000 (Principle Amount) + $5,577.12 (Interest) = $15,577.12 total repayable over 24 months with weekly installments of $149.78.

The Interest Rate for Secured Large Amount Loans is 48%. Maximum Comparison Rate is 48% p.a. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate with the lender that finances your loan. Click here to see a worked example.