There are three fees you need to know about when applying for a small short-term personal loan. Take a peep below
This is a once-off fee that is payable per loan – this means each time you accept the terms of a loan you’ll have to pay an establishment fee. You’ll be charged 20% of your principle loan amount (that’s the amount you want to borrow). This amount typically needs to be paid upfront.
Monthly fees are charged, well, monthly, for every month or part of the month you spend paying back your loan. This is usually around 4% of the principle loan amount per month.
Every time you miss a payment, short pay or have a direct debit bounce, you’ll be charged a fee of around $25-35. Make sure you always have enough funds in your account to make these payments.
Right, now it’s time to talk about the important stuff – what you’ll have to pay each week to repay your personal loan.
Most small personal loan providers charge up to 20% as an establishment fee upfront. You’ll then pay a 4% monthly fee.
Under the current legislation, most small personal loan providers don’t charge an annual interest rate (you’ll know this as an APR) %.
In APR terms, the maximum annual percentage rate on loans between $300 and $2000 is typically 199.43%.
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.
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.
Annual Percentage Rate (APR) is 48% Typical Comparison rate is 67.41% p.a.
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.
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.
ANNUAL PERCENTAGE RATE (APR) IS 21.24% MAXIMUM COMPARISON RATE IS 48% P.A.
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.
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.