Unexpected expenses, emergencies, and great must-have deals are part of life. Unfortunately, so is not having the cash flow to fund these situations. When you find yourself with more expenses than money and need to make ends meet, an unsecured personal loan is a viable solution to the financial pickle you find yourself in.
Whatever you need the cash for, we understand you’re probably in a hurry. That’s why we bring loan offers from Australia’s leading lenders directly to our clients within a matter of minutes.
When making use of our service, you will find the online application quick and easy. And when we say quick and easy, we mean that you can complete the application form in as little as five minutes, get an outcome within two minutes, and receive the funds into your bank account within just one hour of approval.
Before you start your application, let’s find out if an unsecured personal loan is the right loan type for you.
What Are Unsecured Personal Loans and How do They Work?
Unsecured personal loans are personal loans where you don’t have to provide the lender with any security or collateral. Instead of relying on your assets to borrow money, a lender can give you an unsecured personal loan based on your creditworthiness.
The terms of unsecured loans are often contingent on your credit score, and they’ll only require your signature and a promise to pay as collateral. You can get these loans from a wide range of online lenders when applying through Pronto Paydays.
Unsecured personal loans are riskier for lenders because there’s no collateral required. To service the risk, interest rates on unsecured loans may be slightly higher. That doesn’t detract from the fact that these loans are easy to get approval on, quick to apply for, and available on the very same day you apply.
Unsecured loans at Prontopaydays.com.au range from $200 – $10,000 and come with a maximum annual interest of 48% and up to 24 months to pay. However, different lenders may have different loan amounts, terms, rates, and permitted uses attached. While 48% is the maximum allowable interest on unsecured personal loans, that’s not to say that the lender will charge that amount. Many lenders reduce their interest rates for the sake of competitiveness. According to the Australian Securities and Investment Commission regulations, loans of less than $2,000 come with 0% interest attached in Australia.
How personal loans work is quite simple. You can apply for a loan and receive a lending decision online immediately. Because no collateral is required, you don’t have to demonstrate the value of any assets or wait for an appraisal. Once you’re approved for an unsecured personal loan, funds are disbursed as a lump sum. While a strong credit score can help you access lower interest rates, it’s important to note that your credit history and score are not the primary deciding factor in your loan approval.
Types of Unsecured Personal Loans
Several loans fall into the unsecured personal loans category. These include:
- No-collateral personal loans
- Payday loans
- Student loans
- Quick cash loans
- Same day loans
- Unsecured credit cards
Features of Unsecured Personal Loans
When applying for an unsecured payday loan at Pronto Paydays, you will find that our panel of lenders offers personal loans that share the following features.
Amount You Can Loan
Unsecured personal loans typically vary from $200 to $10,000 at Pronto Paydays. It may be tempting to apply for $10,000 even if you only need $2,000, but be wary of that. We always recommend only borrowing what you need to ensure you don’t over-indebt yourself.
Schedule of Repayment
Your scheduled repayments are very important. If you miss your repayment, you could be charged a late payment penalty, and if you continue to miss payments, it will reflect poorly on your credit history. Pronto Paydays lenders offer loan repayment terms of 2 to 24 months. The payment schedule can be arranged according to your income frequency for convenience and to ensure you never miss a payment. Most lenders will allow borrowers to choose weekly, fortnightly, or monthly payment schedules.
Cost of the Loan
What the loan costs you will come down to how much you choose to borrow and how long the term is. As already mentioned, regulations in place stipulate the maximum charges a lender can apply to Unsecured loans in Australia. Currently, those maximum fees look as follows:
- Loans under $2000: 20% establishment fee plus 4% monthly service fee
- Loans up to $10,000: $400 establishment fee plus a maximum of 48% annual interest
Keep in mind that not all lenders charge the maximum fees.
Loan terms are important – they determine how many weeks, months, or years you will spend repaying your loan principal. Most small loans of up to $2,000 at Pronto Paydays are repaid over 7 to 30 days. Larger loan amounts of up to $10,000 are typically repaid over up to 24 months.
Good Lending Reputation
Of course, you don’t want to borrow money from a lender that charges exorbitant prices, isn’t registered/is unlicensed, treats customers poorly, and cannot be reached when customers need them. When borrowing money with the help of Pronto Paydays, you have the peace of mind that the lenders we work with are reputable, have a credit license, and offer total transparency at all stages of the process.
Waiting around is not on the top of anyone’s to-do list. If you want to get an unsecured cash loan in a hurry, you’re in luck. Pronto Paydays prides itself on quick payouts. Once your loan is approved, you will receive the money as soon as the next business day.
Examples of Unsecured Personal Loans
Below is a quick look at some of the unsecured personal loans you can get at Pronto Paydays.
|Lender||Interest Rate||Loan Example||Total Fees on Example||Term|
|Jacaranda||8.90% (variable)||9.18%||$5,000||3-5 years|
Advantages and Disadvantages of Unsecured Loans
· Short Application Time and Approval
Applications for unsecured personal loans are usually shorter because you don’t have to prove ownership of an asset or its value. You get quick approval and feedback online, and funds can be disbursed within a day.
With unsecured personal loans, you get fewer restrictions on how you use the money borrowed. Secured personal loans sometimes require that you only use the funds for specific purposes like buying a car. Unsecured Loans can help you in emergencies, paying school fees, medical bills, home renovations, purchase furniture, or even appliances.
· Lower Risk To Your Assets
Since you’ll not use any collateral to secure the loan, there’s a lower risk of your personal property being sold off.
· Bad Credit Options
If your credit score isn’t very good, you might want to look at loan options where credit history isn’t of paramount importance. You can get a bad credit unsecured personal loan or a no credit check unsecured personal loan—approval for this loan has more emphasis on your current affordability of the loan than your credit rating.
· Additional Fees
Unsecured Loans can involve additional unexpected fees and charges, including penalties for paying late or paying early. In addition, if you fail to honour your repayments, a lender can commission collection agencies to collect the debt where you will have to pay the debt collection fees too.
Unsecured Loans vs. Secured Loans
With small secured personal loans, you have to give something you own as collateral. You can put up an asset such as your car, high valued items like jewellery and art, or a house. If you default and fail to make repayments for your loan, the seller can seize and sell your asset to get their money back.
If you don’t wish to risk your assets, you can choose small unsecured personal loans which don’t require you to put an asset up as security. Your creditworthiness supports an unsecured loan. Lenders may also look into your finances and income to assess your ability to pay.
Unsecured loans have higher interest rates than secured loans, shorter loan term periods, and lower loan amount caps because they’re riskier than secured loans.
Eligibility Criteria for an Unsecured Payday Loan
To be eligible for an unsecured personal loan in Australia, you need to:
- Be aged 18 years and above.
- Be an Australian citizen or permanent resident of Australia – or have an acceptable visa.
- Have a good credit rating (although some lenders are lenient with this)
- Provide documentation that proves your ability to repay the loan. This can include employment details for the past three months or financial information such as your income before and after-tax.
- Meet 100 point proof of identity. This can include providing your driver’s license, passport, birth certificate, or government employment ID. You may also be asked to provide an Australian marriage certificate, Medicare card, utility bills, or mortgage documents where applicable.
Application Process for an Online Unsecured Personal Loan
Getting the cash you need takes just a few minutes of your time. Here are the steps to following when applying for an unsecured personal loan at Pronto Paydays.
Step 1: Evaluate Your Budget
Take some time to evaluate your current expenses and income to determine the amount you can comfortably pay. Late payments will negatively affect your credit score, so you have to ensure debt payments fit within your budget. Some lenders will consider your debt-to-income ratio when evaluating your application. You can even use free financial counselling services when making your decision.
Step 2: Gather Your Documents
Collect the necessary documents ready for quick processing of your application. Lenders may require you to provide proof of identification, income statements, or bank statements along with your proof of address. Have these on hand so that you can provide them immediately as requested.
Step 3: Apply Using Our Easy Online Application Form
Filling out the online application form at Pronto Paydays will just take a few moments of your time. Be as accurate as possible with your details as the information you supply will be used to determine if you are a viable borrower. Again, don’t request more money than you need.
Step 4: Come to Agreement with the Lender
When you’ve submitted your application, it’s time to let our automated system take care of the rest. Once a lender accepts your loan request, you will be pushed straight through to their website to complete the process. The lender will discuss the loan offer with you and make reasonable inquiries regarding affordability, lifestyle, and of course, the most convenient payment schedule for you.
Once you’ve come to an agreement, it will be put in print and sent to you in the form of a contract. All that’s left to do is read through the terms and conditions, double-check the repayment schedule, sign it and send it back to the lender. The money will be in your bank account by the next business day.
In the unfortunate and unlikely event that your finance request is denied, we’ll make sure to tell you immediately so that you can make another arrangement for funds.
What is a Personalized Interest Rate in Unsecured Personal Loans?
A personalized interest rate is the rate of interest the lender will charge you based on how risky it is to lend to you. This will be based on the amount you request, your credit status, income, and the period you need to repay.
Can I Borrow Unsecured Loans From More Than One Lender at a Time?
Although it’s possible to borrow from more than one lender, it’s not advisable because of the high-interest rates on unsecured loans. As a result, you may end up with more than one expensive loan and unmanageable debt.
Can I Get an Unsecured Personal Loan with Bad Credit?
Yes. Even with a poor credit history, you can get an unsecured personal loan from lenders who cater specifically to bad credit borrowers. These can include debt consolidation loans or payday loans.
Can I Get an Unsecured Loan if I Am Unemployed?
Yes. As long as you have a good credit history and some form of income to repay the loan, you can get approved for an unemployed loan.
Why Did I Get a Rate Higher Than the One Advertised When I Applied for an Unsecured Personal Loan?
The lender may be using a risk-based interest rate system where the information in your application determines the rate applied. They may also have found out that you’re a high-risk borrower. In the end, the interest rate and fees can vary from lender to lender, and most lenders apply these on a case-by-case basis. Always check the loan agreement to make sure you’re aware of the fees before you sign it.