Short Term Loans

Assessing Personal Loan Interest Rates

Interest rates are perhaps the number one concern when getting a loan. Whether that is a mortgage, a commercial loan or a credit card annual percentage rate (APR).

However, a personal loan interest rate may be the most important to consider. The rate is often hidden by the provider, giving a round number for the payment. After calculating the true rate, these numbers can often be exorbitant. For that reason, it is crucial to consider the actual interest rate.

For example, a loan of $1,000 that has to be paid back in three months with an interest payment of $200 does not seem like a high rate. However, the calculation comes out to 80% per year. This is a very high rate compared to other types of loans. While personal loan interest rates tend to be higher, this is quite extraordinary.

Additionally, longer loans often have better APR and less associated fees. They may not have an establishment fee and also much lower monthly service fees. Longer loans may even have a lower monthly payment than a shorter loan, depending on the amount.

Your credit score is also crucial in the application and approval of the loan, as well as the ultimate interest rate. Individuals with a better history of credit have a lower interest rate while the reverse is true for those with a bad credit history.

Credit24 is the leading personal loan interest rate provider in Australia. We have the best rates with the easiest application process, ranging from $500 to $10,000. We have flexible terms and a negotiated process. For more information, contact us today.