Hoping to buy that new car to make your commute to work easier, or maybe take a few months off work to travel, reset and refocus? Do you perhaps have medical bills you need to pay off pronto, or need cash to plan your dream wedding?
If so, a $50,000 personal loan might be the appropriate solution.
Where can I get one from?
Most well-known banks will offer $50,000 loans to their eligible customers, so your bank of choice is one place to start. Alternatively, you might choose to approach a smaller lender—check out RateCity’s loan comparison page to find potential lenders.
Interest rates for $50,000 personal loans have been known to go as low as 5 per cent and as high as 18 per cent, depending on the lender. It’s important to note that the higher the interest rate, the more you will have to repay.
While fixed interest can be desirable as the rate will remain the same for the duration of the loan regardless of market rates, agreeing to a variable rate will allow you to benefit if the market rate drops.
Secured loans vs unsecured loans
You might notice that interest rates associated with secured loans seem lower than those of unsecured loans.
This is because lenders ask for an asset, such as a car or home, as a guarantee for secured loans—this gives the lender the ability to repossess the asset in question and sell it to obtain the amount owing, if you default on your loan.
Unsecured loans pose more risk to lenders as they do not provide the lender with this security, which is why their interest rates are higher.
While the documentation requirement of each lender will vary slightly, most lenders will ask you to provide examples of a combination of the following:
Proof of identity
- Driver’s licence
- Proof of age card
- Birth certificate
- Utility bills
Proof of income
- Recent pay slips
- Recent tax returns or financial statements
- Recent ATO tax notice of assessment
Proof of ability to meet repayment requirements
- Bank statements
- Credit card statements
- Information on any other loans undertaken
If you are hoping to have a $50,000 personal loan approved for purchasing a car, you might have to provide additional documentation such as insurance details and your car’s tax invoice.
Pros and cons
Obtaining a $50,000 personal loan will no doubt assist you to book that extended holiday or buy that new car you need. A personal loan’s interest rate would be much lower than that of a credit card, so if you know you will need some time to pay back the full amount, a personal loan might be the right option for you.
On the flip side, the application process for a personal loan can be quite time consuming. It will also mean added debt, which is not ideal if you already have an excessive credit card debt or a large amount owing on a home loan.
As with any financial decision, it’s important to do your research, compare products and speak to several lenders prior to committing to a loan. Visit RateCity’s personal loan comparison page to find out more about personal loan options which suit your needs.
Disclaimer: This information contained in this article must not be taken as financial advice.