5-Star Personal loans
The tables below list all of Canstar’s 5-Star rated personal loans from its latest Personal Loans Star Ratings (released November 2017). We will also breakdown what makes up a 5-Star personal loan and how they differ from the average product in the market.
The products with links displayed in these tables are based on a loan amount of $20,000 in New South Wales to be repaid over three years.
Secured personal loans
Secured personal loans are taken out against an asset you own, and if you do not repay the loan, the lender can sell this asset to recoup their money. The following five secured personal loans were awarded a 5-Star rating by Canstar in November 2017.
| 5-Star Secured Personal Loans | |
|---|---|
| Company | Product |
| First Option Credit Union | Secured Personal Loan |
| Heritage Bank | Low Rate Secured Loan |
| Holiday Coast Credit Union | FTD Secured Loan |
| Hume Bank | Secured – Term Deposit |
| Select Encompass Credit Union | Personal Loan Sec by TD |
| Source: Personal Loan Star Ratings. November 2017 | |
Unsecured personal loans
Unsecured loans, on the other hand, involve the lender agreeing to lend you money without taking a form of security, meaning they take on a higher degree of risk. The following 11 unsecured personal loans were awarded a 5-Star rating by Canstar in November 2017.
| 5-Star Unsecured Personal Loans | |
|---|---|
| Company | Product |
| Bank Australia | Personal Loan – Property Owners |
| Gateway Credit Union | Personal Loan |
| Liberty Financial | Personal Best |
| MoneyPlace | Unsecured Loan A – Excellent Credit |
| My Credit Union | Special Offer Personal Loan |
| Newcastle Permanent | Personal Loan – Unsecured |
| QBank | All Purpose Loan – Special |
| RateSetter | Unsecured Personal Loan – Fixed |
| Regional Australia Bank | Personal Touch Loan |
| Select Encompass Credit Union | Personal Loan Var Rate |
| Summerland Credit Union | Equity Plus Unsecured |
| Source: Personal Loan Star Ratings. November 2017 | |
Interest rates on personal loans
The table below displays the minimum, maximum and average interest rates for secured and unsecured personal loans on Canstar’s database (as at 3/11/2017).
To give you an idea of the difference between 5-Star personal loans and other personal loan products, the table also displays the average interest rates of 5-Star rated products and how this differs from the market average (as at 3/11/2017).
|
Personal Loan Interest Rates |
||
|---|---|---|
|
Unsecured Personal Loan |
Secured Personal Loan |
|
| Loans rated | 112 | 59 |
| Min | 7.22% | 4.24% |
| Max | 22.99% | 20.87% |
| Average | 12.34% | 9.39% |
| 5-Star average | 9.23% | 5.00% |
| 5-Star Difference | 3.11% | 4.39% |
| Rates as per conditions outlined in Personal Loans Star Rating Methodology for relevant profile and are correct as at 3/11/2017
Source: www.canstar.com.au |
||
Fees on personal loans
Fees are another important thing to consider when taking out a personal loan, and there is a significant difference between the fees for 5-Star products and the market average.
|
Personal Loan Fees |
||||
|---|---|---|---|---|
|
Unsecured |
Secured |
|||
|
Upfront fees* |
Ongoing fees | Upfront fees* |
Ongoing fees |
|
|
Min |
$0.00 | $0.00 | $0.00 | $0.00 |
| Max | $750.00 | $156.00 | $380.00 | $156.00 |
| Market average | $194.57 | $43.39 | $183.25 | $58.98 |
| 5-Star average | $158.09 | $5.45 | $135.00 | $24.00 |
| Difference | $36.48 | $37.94 | $48.25 | $34.98 |
| *Fees are the ongoing fees that would be incurred on an annual basis and are correct as at 3/11/2017. Source: www.canstar.com.au | ||||
How much could you save on a 5-Star loan?
When you combine the lower fees and interest rates on our 5-Star rated products, you can save a whole lot of money over the course of your loan. For example, if you plugged the numbers from the table below into Canstar’s loan comparison calculator, you’ll see how a 5-Star personal loan could save you thousands compared to one with market average fees and interest rates.
| Secured personal loan – 5-Star vs market average | ||
|---|---|---|
| Average 5-Star loan | Market average loan | |
| Loan amount | $20,000 | $20,000 |
| Loan term | 5 years | 5 years |
| Upfront fees | $135.00 | $183.25 |
| Ongoing fees | $24.00 | $58.98 |
| Interest rate | 5.00% | 9.39% |
| Repayments | Monthly | Monthly |
Using these figures, an average 5-Star personal loan would cost you $24,185 ($4,185 in interest) over the term of the loan, with monthly repayments of $401. Comparatively, a loan at market average interest rates and fees would cost a total of $28,878. So compared to the market average loan, the average 5-Star personal loan would be $4,963 cheaper over a five year loan term. This is an average figure and will vary depending on your circumstances and criteria.
Compare personal loans with Canstar today:
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