Need a personal loan with bad credit? View your loan options
It can be a serious matter to receive a poor credit rating and be black-marked as a poor credit risk, especially if you are looking to take out a mortgage or loan in the future.
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RACV was established in Melbourne in 1903 as a motorists’ social club. The club operated to encourage and develop the motoring industry and actively sought to protect the rights of motorists. Today RACV’s support their 1.9 million members and community through their car insurance products and the RACV Foundation.
RACV personal loans are suited to a wide range of borrowers and can be used for a variety of purposes like renovations, holidays, debt consolidation, caravans and cards. Existing RACV members may be eligible for discounts depending on their level of membership.
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monthly over 5 years
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Whether it’s a caravan, car, holiday or home improvement, RACV personal loans can be used for a range of purposes. RACV offers secured and unsecured fixed-rate personal loans to its members and borrowers who wish to become members. Its loan terms range between one to seven years and have a minimum loan amount of $5,000.
Some of the main features of an RACV personal loan include no account-keeping fees, easy online application and fast approval within five working hours It’s worth mentioning that borrowers wishing to pay out their personal loan before the term will face a penalty. In some circumstances, there’s no need for a deposit.
RACV personal loans can be used for a range of different purposes including:
Customers looking to contact RACV customer service can do so via the call centre, through online chat or pop into a branch in Victoria. Borrowers can also contact customer service via:
To be eligible for an RACV personal loan, you’ll need to meet the following criteria:
To apply for an RACV personal, borrowers can apply online through the RACV website, over the phone or in store. The application process takes around 10 minutes and involves the following steps:
At the time of application, you’ll need to provide the following documentation:
RACV personal loans may appeal to borrowers who are already members or would like to become a member. Under the RACV membership benefits scheme, existing members may be eligible for a discount and should check before applying.
The RACV secured fixed-rate personal loan has a moderately low interest rate and has no ongoing fees. Borrowers have the option to make additional repayments, however there is a fee for paying out the loan before its term. It’s worth mentioning that there is a high upfront application fee for the RACV personal loan in addition to a late payment fee.
The RACV personal loan allows borrowers to choose either fortnightly or monthly repayments.
While RACV do have a number of branches in areas of Victoria, borrowers who do not live near a branch can contact the lender by phone and online seven days a week.
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Borrowers who take out bad credit personal loans don’t just pay higher interest rates than on regular personal loans – they also get loaned less money. Each lender has its own policies, but you’ll find it hard to get approved for a bad credit personal loan above $50,000.
Few, if any, lenders would be willing to give guaranteed approval for a bad credit personal loan. Borrowers with bad credit histories can have more complicated financial circumstances than other borrowers, so lenders will want time to study your application.
It’s all about risk. When someone applies for a personal loan, the lender evaluates how likely that borrower would be to repay the money. Lenders are more willing to give personal loans to borrowers with good credit than bad credit, because there’s a higher likelihood that the personal loan will be repaid.
So a borrower with good credit is more likely to have a loan approved and to get that approval faster, while a borrower with bad credit is less likely to have a loan approved and to get that approval slower.
The worse your credit history, the harder you will find it to consolidate your debts, because lenders will be less willing to lend you money and will charge you higher interest rates.
However, people with bad credit histories can make debt consolidation work by following this three-step process. First, find a lender willing to give you a bad credit personal loan – this process will be simplified if you go through a mortgage broker or use a comparison website like RateCity. Second, make sure the interest repayments on your new loan are less than the repayments on the loans being replaced. Third, instead of spending those savings, use them to repay the new loan.
It’s unusual for a lender to make a personal loan above $100,000, although there is no formal limit. As with all lending products, each lender sets its own policies, while each borrower is assessed on a case-by-case basis.
In the best-case scenario, an application for a bad credit personal loan can be made within minutes and then be approved within 24 hours.
Lenders aren’t allowed to charge interest on loans of $2,000 and under. Instead, they make their money by charging a one-off establishment fee of up to 20 per cent and a monthly account-keeping fee of up to four per cent. Lenders might also ask you to pay a government fee.
For loans between $2,001 and $5,000, lenders can make their money in only two ways: a one-off fee of $400 and annual interest rates of up to 48 per cent.
For loans of $5,001 and above, or for loans that have terms longer than two years, lenders can charge annual interest rates of up to 48 per cent. (Those fee caps don’t apply to loans offered by authorised deposit-taking institutions such as banks, building societies or credit unions – although such institutions are highly unlikely to charge interest rates of anywhere near 48 per cent.)
Some lenders are able to approve applications over the internet and within minutes. However, there is a catch. People who take out easy/instant loans generally pay higher interest rates and are restricted to lower amounts than people who follow a traditional borrowing process.
In some instances, bad credit personal loans can help people with bad credit history to consolidate their debts in such a way that it makes it easier for them to repay those debts. This is because the borrower might be able to consolidate several debts with higher interest rates (such as credit card loans) into one single debt with a lower interest rate.
However, this strategy can backfire if the borrower spends the extra money instead of using it to repay the new loan. Another disadvantage of bad credit personal loans is that they have higher interest rates than regular personal loans.
The Australian personal loans market contains dozens of lenders offering several hundred different products. Personal loans are available through a range of institutions, including:
There are three main ways to access personal loans. You can go through a comparison website, such as RateCity. You can use a finance broker. Or you can directly contact the lender.
A bad credit personal loan is ‘secured’ when the borrower offers up an asset (such as a car or jewellery) as collateral or security. The lender can then seize the asset if the borrower fails to repay the loan.