Non-Conforming Loans, Bad Credit Loan, Unsecured Personal Loan

Non-Conforming Loans In Australia

Here in Australia we have a wide variety of loan lenders and many different types of non-conforming loan, often known simply as bad credit loans. In the following paragraphs we will briefly outline some of them. For more detailed information, please check out the fuller explanations elsewhere on this website.

Bad Credit Loans Overview

When you are looking for bad credit lenders online, you will want to find a lender based conveniently near to you, so that you can go and talk to them in person. Dealing directly with the loan company is the best way to proceed, especially as you will be revealing sensitive information about your financial history.

Before you decide which finance company to give your business to, run thorough checks online and compare their services, terms and conditions with other lenders.

Bad Credit Loans

If you feel that a bad credit loan is right for you, make sure that you are fully aware of the terms for early and defaulted payments. In other words, what will it cost you if you can't repay the loan in the specified due dates? Bad credit lenders vary widely in their policies, so you should really shop around to be certain that you have a good deal.

Be certain to assess how frequently you are required to repay the installments on your non-conforming loan. Would paying off your debts weekly, fortnightly or monthly be better for you, as each of these would have a different effect on the speed at which the lump sum of the loan is reduced. Remember that the smaller the loan, the lower the interest rate, so paying off your bad credit loan in smaller chunks more regularly could save you a lot of money in the long run.

It is also worth checking whether or not you can make early or larger installment payments on your loan as some bad credit loans may penalize you for this.

Bad Credit Personal Loans

This kind of non-conforming loan falls into 2 main categories:

Cash Doctors

Secured Personal Loan – This is when your loan is approved, provided you have an asset that you can offer as a guarantee. Most commonly, this type of bad credit loan is 'secured' by a major asset, such as your house or car. If you fail to make the loan repayments, the lender can take that asset to recoup their losses.

Unsecured Personal Loan – This is when the borrower has no big asset that they can put forward as collateral on a loan. As a result, the interest rates on this kind of bad credit loan can be very high and the terms very restrictive, so be sure you know exactly what you are agreeing to before you sign anything. One of the most common forms of unsecured personal loan is the debt consolidation loan, where all of your outstanding debts are lumped together into one repayment scheme. For more information on debt consolidation, please see our sister website

Bad Credit Home Loans

A non-conforming home loan may be the only kind of mortgage open to you if regular home loan lenders, such as banks, decline your home loan application. People who might benefit from a bad credit home loan range from those who have a bad credit rating or are bankrupt, to people who do not have a regular income.

As with most bad credit loans, this type of impaired credit loan usually comes at a cost, with high interest rates and rigid fees locked in, so make sure you understand the terms fully before you agree to them.

Bad Credit Car Loans

Car loans are an area that is particularly sensitive to borrower's credit ratings and even a small blemish on your payment record can result in you being rejected for an ordinary auto loan. Bad credit car loans give you the chance to get the vehicle you need, whether it's a brand new car or had a previous owner.

As you can see, having bad credit does not automatically mean that you cannot get a loan. Non-conforming loans are deigned specifically to fill the gap between conventional lending and those with debt issues or a lack of financial stability. However, the specialized nature of these loans means that they come with additional costs and high interest rates, so check everything and do plenty of research before you make any binding decisions.


We do not claim to represent any Australian bank, lender, or financial institution. Thank you for consulting
this overview on non-conforming loans. Copyright 2008
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