Secured personal loans are the best type of personal loan to receive a better interest rate. You can use your car, boat, motorbike or caravan to secure the personal loan and achieve a better interest rate which means much lower monthly repayments for you.
For secured personal loan in general we accept up to 7 year old vehicles as security or with a minimum value of $10,000.
We also accept security where the value is more than $2000 under some special combined secured and unsecured loan product offers with particular lenders.
If your planning to purchase any motor vehicle using a secured personal loan we can help arrange a pre-approval for a secured personal loan or car loan. You may even decide that you prefer to purchase the car from a private seller using a secured personal loan. If the security offerred is not currently under your name we can also arrange pre-approval for the loan so you may transfer the registration after getting the approval of your secured personal loan.
Secured personal loans can be used for any worthwhile purpose, not just to buy a car or vehicle.
We also offer a blend of secured and unsecured personal loans when the value of the car or other security is less than the amount of money that you wish to borrow.
Lenders determine the average trade in value of the offered security using "Glasses Guide" or "Redbook" and define the acceptance of the security based on various factors such as age, number of KM's etc.
We can also help make the process easier for Self-employed applicants who would like to obtain a loan against their existing vehicle. Self-employed secured personal loans are suitable for clients who have adequate income to service the new loan based on their most recent year individual tax return. Clients can provide either recent year or the previous tax return, whichever one shows the most favourable income figures. If the most recent years tax return is signed and dated by client and lodged by licenced Tax agent, there is no need to wait for any Tax assessment notice. In other words, we don't need any individual tax assessment notice.
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- We accept Good Credit and Bad Credit clients for our personal loans and car loans
- Bad Credit may include;
^ Too many credit enquiries
^ Court Judgements
^ Default (Paid or Unpaid)
^ Part IX Bankruptcy otherwise known as debt agreements
- Good credit is basically having a Good Veda 1.1 Credit Score, a low number of credit enquiries in the past 12 months and low number of enquiries in the past 5 Years.
Credit history is the first criteria that a lender will need to know about before even considering to spend any further time reviewing your application. Each lender has a slightly different policy regarding what is considered an acceptable Credit History. With such a large number of personal loan and car loan lenders on the market, this is why is makes sense to engage a personal loan broker or car loan broker so you only need to apply once (in most cases) to secure an approval, since a good finance broker will give you the best chance of success by presenting the application to the right lender first time and ensuring the application is completed in the best possible way. It's amazing how many potential clients fill out the form wrong and get declined for this reason alone.
Secured personal loans require collateral to secure the debt (security). This can be a boat, boat trailer, car, truck, ute, jet ski or other registered and comprehensively insured item that has a market value of at least $5000, however ideally worth greater than $10,000 in order to meet a wider variety of lending options. Each lender has a slightly different method of determining the value of the collateral, however you can obtain a guide by using the free valuation tool at the following link.
Ask yourself the following;
In the past 6 months, have you
1) Overdrawn / exceeded any of your credit facility limits
3) Missed any repayments
2) Had a negative balance on any of your transaction accounts or constantly have a low balance in your account
If you have answered yes to any of the above, then you will either need a Non-conforming lender, bad credit lender or a lender who does not require copies of the above documents to support the loan application.
With all the lenders on the market, how can you be sure you have selected the lender where you meet the policy requirements, have acceptable documents and meet the criteria on this page?
You are better off to run your scenario by us by calling 1800 88 LOAN so we can guide you in the right direction and apply on your behalf once you engage us as your broker.
Lenders have various ways to assess character of the borrower. If the client has certain transactions on thier statement such as regular visits to casino's, hotels, signs of gambling or excessive expenditure at alcohol outlets, the lender may either decline the loan on this basis or in conjunction with other considerations. A common example is where the client gets paid on thursday, then on a friday it is obvious that there are large deductions from bank account at a hotel/club gaming lounge followed by transactions including alcohol purchases. If the net result is that client has little amount left in account after that outing and not much money to spend on remaining living costs and housing, then the lender could be seen as an irresponsible lender by lending money to a client with those type of spending habits.
Other forms of character assessment when applying for a personal loan can include a google search to see if there is any recent negative media articles regarding criminal activity, charges etc. It is quite rate that a loan is declined on the above basis, however this is a factor which applicants need to be aware of when applying for a personal loan, wither on a secured basis or unsecured basis.
The lender may approve a personal loan and depending on client situation they may impose certain conditions of approval.
For example, we often have clients requesting a loan, however they have clearly run out of money each month in their bank account, therefore this shows that they do not have any capacity to make the installments on the loan. If we can help justify to the lender the reasons why this is the case, then the lender may accept the reasons, however impose a condition that the clients loan is paid for via salary deduction. This means that the payroll officer within the company the applicant is employed by would deduct the loan repayments from the regular payroll and make the loan repayments directly to the lender on the borrowers behalf. Some lenders call this "Payroll deduction". Our lenders who are most likely to use this loan repayment method are the non conforming lenders, which some people also refer to bad credit lenders.
There are various other conditions the lenders may come up with when applying for a personal loan and most often these are case by case requirements from the lender.
Capacity is your ability to repay or meet the regular monthly commitments of the personal loan or car loan.
Each lender has a different method of calculating and makes slightly different assumptions, however as a general rule it works as follows;
For example, the lender will consder the following information;
1) How much is your monthly income?
2) How much are your accomodation costs (Rent or mortgage repayments)?
3) How many dependants do you have, therefore what is the estimate of living costs to raise dependants?
4) How much are the living costs for yourself and partner?
The net result will provide an amount of surplus income that you may theoretically have spare for loan repayments. Based on the lenders interest rates, proposed loan term and other factors the lender can then calculate what is the maximum loan amont they will lend you.
For personal loans and car loans, Borrowing capacity is probably the second most important criteria for most lenders in calculating if they will give you any money at all. If you dont pass this test, then it would be foolish for the lenders to lend you any money.
The value of your total assetts minus your total liabilities (debt) equals your Net Worth or Capital.
To be elligible for an Unsecured personal loan, you will need to have a reasonable amount of net worth. Depending on the lender, this may need to be 1 to 5 times the amount you wish to borrow.
On the other hand, if you apply for a secured personal loan, the lender will approve your loan even if your net worth is closer to 1 - 2 times the amount you wish to borrow, since the lender can recover the collateral if you fail to make repayments towards your loan.
Another way how capital can assist you obtain that approval you need, is in a situation when you are purchasing a car and you need a car loan. If you are purchasing a second hand vehicle and your financial position is not so great or you have a bad credit history, the lender will require you to contribute some capital (deposit). This reduces the risk for the lender. Generally you will need to contribute between 10% to 30%, depending on your overall situation.
Any broker will tell you that every loan applicants situation is quite unique, however most clients can fit in a certain category which is partially determined by variables such as;
- Are you a property owner (Property Owners are looked upon more favourably)
- Repayment history on current and recently closed credit facilities (Have you missed any repayments)
- Stability of Residency (The longer that you have been at the same residence, the better)
- Age (applicants in the 25 to 50 Years of age categories are often looked at more favourably.
- Employment type (Fulltime, part time, casual)
- Length of employment - What type of finance you have applied for in the past (e.g. Multiple pay day loans within the past 12 months will look very negative and we may need to apply through a bad credit lender for you).
So, unless you know all the answers and understand your own rating for each of the above features AND you know the lenders policies in relation to the above, the chances are, you are likely to get declined. Even high paid and well assett backed clients often get declined when applying for a personal loan or car loan as they may have some minor blemishes in 1 or more of the above categories or they may have only just started in a new job for 3 months and not applied with a lender who has policies that match up with the applicants situation.
If you would like to preserve your credit rating, apply with confidence and increase your chances of approval, then you have come to the right website to apply. We know the policies, we can ask you questions to analyse your situation and apply first time with the right lender to get you the best result based on your actual situation.The amount of volume of applications we lodge, get approved and settled with lenders, gives us the insight to get the approval you need. There are also the trade secrets that help get things over the line, including our professional credit summaries that we submit with your application to sell to the lender the benefits of approving your loan.
Dont delay, call 1800 88 LOAN (5626) today and speak with one of our personal loan specialists.
Alternatively, if you would like to see a list of Secured Personal loan lenders and apply by yourself, you can access a list here. Secured personal loan lenders list in Australia
(Note, this is a Draft list - If we have missed any, please send us an email to let us know and we will add to the list)