Business Loans #3; Can You Get a Loan In Australia with a Bad Credit History?

Nearly anything in life is possible, depending upon who and what you know, especially when it comes to having a bad credit rating and needing a loan. You could take out an ‘official’ loan through a bank or an insurance company or, if neither of those options are available then you might be able to find a personal or, independent lender that is prepared to lend you what you need there are however, a number of things that you need to bear in mind;

Monthly repayments

If you have a bad credit rating then you’ll probably find that there are companies to help you with secured bad credit loans in Australia however, the monthly repayments that they quote might be much higher than you were prepared for. Unfortunately, this is just part and parcel of securing a loan when your history of paying back previous loans is has a blemish or two on it.

The lenders know that, if you are asking for loan then you probably don’t have any other options and, you wouldn’t be asking unless you needed to hence, it’s worth shopping around to make sure that you get a fair deal.

Interest rates

You may or may not know about interest rates, the majority of people will know the term but, won’t necessarily fully understand what it means. Interest rates are also referred to as annual percentage rate (APR) and is worked out on a percentage basis depending upon the amount of money you borrow and the length of your loan. Generally speaking, the higher the APR, the more money you will have to pay back to the lender, unless you have the option to settle early. You could look at APR as the insurance companies profit, or bonus for lending you money.

Charges

Hopefully you can find a company that doesn’t have any additional charges over and above the APR that have agreed with them, you would be very lucky indeed though. Most companies will have various fees for things like early settlements and missing or, late payments. Some companies even charge for overpayments, for example, maybe you have a particularly profitable month and want to throw some extra dosh in the pot in order to pay off your loan sooner.

Making a decision

For some people, the details of loans, APR’s and early settlement fees are enough to make them go to sleep, for others, they just don’t understand which is fine but, even more reason to get some advice prior to talking to lenders.