What makes a 5-Star Personal Loans product?

The personal loan products that received 5-Stars are generally competitively priced and feature rich.

Interest rates

The interest rate represents the largest component of the total cost of the personal loan. Canstar Research found a significant difference between 5-Star rated products and the market average:

Personal Loan Interest Rates
Car Loans Unsecured Personal Loan Secured Personal Loan
Loans rated 256 112 59
Min 5.12% 7.22% 4.24%
Max 21.99% 22.99% 20.87%
Average 10.31% 12.34% 9.39%
5-Star Average 6.16% 9.23% 5.00%
Difference 4.15% 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

Upfront and ongoing fees are also an important factor when comparing personal loans, with some having a low interest rate and a relatively high upfront fee. The Star Rating examines both the interest and fee component when judging the individual product.

Car Loan Unsecured Personal Loan Secured Personal Loan
Upfront Fees Ongoing Fees* Upfront Fees Ongoing Fees* Upfront Fees Ongoing Fees*
Min $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
Max $1,250.00 $156.00 $750.00 $156.00 $380.00 $156.00
Market Average $199.21 $38.39 $194.57 $43.39 $183.25 $58.98
5-Star Average $154.04 $6.92 $158.09 $5.45 $135.00 $24.00
*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

Features

Personal loan products that performed well in features would often offer some or all of the following:

  • Redraw and top up facilities
  • Ability to make extra payments
  • Ability to defer payments
  • Ability to make repayments via a variety of channels (e.g. branch, atm, telephone)
  • Availability of Loan Insurance
  • Security swaps allowed
  • Easy application (e.g. online or via mobile app)
  • Fast approval turnaround times
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