Instant loans work exactly as their name implies: they are delivered almost instantaneously to the borrower. This makes a lot of difference to many borrowers who are looking for an immediate source of funds, considering that most loans take a significant amount of time to process, usually a week.
There are many lenders in Australia that are providing instant loans for amounts of up to $2,000. These loans typically have an online application process, and are given out within 30 minutes, a couple of hours, or a day of the initial loan application, provided the application has been filed during business hours and meets all of the lender’s specified terms and conditions.
Naturally, since instant loans provide a distinct service of quick processing times compared to other loan options, their lenders also charge a relatively higher fee to their borrowers. That is why it is imperative that applicants only apply for instant loans if they don’t have any better loan options at their disposal, especially if their need for funds is not immediate.
Instant Loan Features In Australia
There are many instant loan providers in Australia, and most of them are offering similar instant loan features.
- Loans are available with a maximum amount of $2,000, although some lenders also offer instant loans of up to $5,000.
- Loan terms are typically available between a period of 3-12 months, although some lenders offer terms of as little as 9 weeks and as much as 2 years.
- Loan approval times vary between lenders, with some lenders approving loans within 30 minutes while others take as long as 48 hours. For most lenders, the loan approval time would be within the same business day.
- Arrears fees being charged by lenders vary as well. Some lenders have only a $5 arrears fee, while others are charging as high as $55.
- Loans under the amount of $2,000, which is the case with most instant loans available in Australia, have a capped cost of 20% establishment fee and 4% monthly fee, although these can vary by lender. Some lenders charge this much, others are charging as low as 10% in establishment fee and 2% in a monthly fee, while some charge a fixed rate such as 47.8%.
- Typically, a fortnightly payment on an instant loan with most borrowers would fall within the $300-$400 brackets.
Tip: There might be other charges associated with your chosen instant loan, hence you should carefully review all borrowing costs before choosing a lender.
The Application Process
Applying for an instant loan is easy. Most lenders would require applicants to fill out an online application form, which can be accessed through their website. Once this form has been submitted, lenders usually provide an approval decision within minutes, and funds are transferred within a day or two, depending upon procedural constraints. Many lenders also offer cash instant loans which are quicker as they don’t involve the banking channel and hence cut down any delays caused on part of the bank.
How Much Can Be Borrowed Through An Instant Loan?
Each lender has different criteria for judging whether an applicant qualifies for their required loan amount. This criteria usually includes an assessment of an applicant’s income and credit history. Some borrowers may not be eligible to acquire instant loans of above $1,000 due to eligibility constraints. The minimum that can be borrowed as an instant loan is typically around $100, while the maximum can go all the way up to $5,000.
Tip: You should only seek an instant loan of an amount that covers your immediate expenditure, as instant loans are expensive and only supposed to offer short-term financial relief.
Evaluating Different Instant Loan Options
The following judging criteria can help to differentiate between various instant loan options and help borrowers select the most appropriate one, considering their needs.
- Does it offer the required loan amount?
Direct lenders offer different loan amounts, so it’s important to know whether a lender can give out an instant loan of the required amount. Since each lender has different eligibility criteria for approving a particular loan amount, it is important to evaluate the chances of approval before filing the loan application to avoid wasting time.
- Is the lender offering a comfortable loan term?
Loan terms are not standardized, and lenders would try to give out a loan term that maximizes their own profitability. A longer loan term, such as 24 months, may offer smaller payments, but it will also cost much more than a loan with a term of 9 weeks. Hence, it’s important to choose a loan that offers an optimal loan term.
- Are the repayments affordable?
Borrowers have the option to set their repayment frequency, and this should be done considering affordability. Every lender has its own repayment terms, and not all lenders are equally flexible. Some might charge if a borrower makes early repayments. Borrowers should look for loans with no early repayment charges.
- Is the loan charging appropriate fees?
Loans under $2,000 are capped, however, loans above this amount can be charged variable rates. It is important to evaluate instant loans as they can become very expensive.
- How quickly can the loan amount be disbursed?
It might take as little as 30 minutes or as long as an entire business day. Each lender has a different turnaround time, and borrowers must take this into consideration as this can make a lot of difference if they require funds very urgently.
- Is the lender reputable?
Online reviews can offer reasonable evidence about a lender’s credibility and repute, and hence briefly researching a lender before applying for an instant loan may be a good idea to ensure the lender does not charge any hidden fees or partake in any fraudulent activities.
Here’s What You Need To Be Eligible
Most lenders that provide instant loans in Australia would require applicants to meet the following eligibility criteria. Applicants must:
- Be over the age of 18
- Hold a permanent residency in Australia or be an Australian citizen
- Have eligible income with more than 50% coming from sources other than Centrelink or other government benefits
How quickly can I get the loan amount through instant loans?
Some lenders disburse funds in less than 30 minutes, while others take over 1 business day.
Are instant loans only available online?
In most cases, instant loans are available only through an online application form. Some lenders do provide instant loans in-store as well.
How much can I borrow through an instant loan?
Borrowers can acquire instant loans of up to $5,000, starting as low as $100.
Are instant loans expensive?
Lenders charge a higher rate for instant loans in return for a quick service and assuming a higher risk.