What three things should you pay attention to when comparing loans?

When diving into the world of loans, it’s essential to pay attention to three crucial elements – rates, fees, and loan terms. These are the factors that can significantly influence the total cost of a loan and impact your financial decisions.
Starting with rates, they are made up of two parts: the interest rate and the comparison rate. The interest rate can be fixed or variable. SocietyOne offers a fixed interest rate, which ensures that your repayments remain the same throughout the term of the loan, providing a sense of security and simplicity in budget planning.
On the contrary, variable interest rates fluctuate based on market conditions, leading to varying repayments. An increase in interest rates would mean higher repayments, while a decrease would lower your repayment amounts.
SocietyOne stands out in offering personalised rates, ensuring fairness and consideration of individual circumstances. Your credit score is a key determinant here, meaning the higher your score, the lower your rate could be.
Then there’s the comparison rate, which incorporates the interest rate as well as most upfront and ongoing fees and gives a more comprehensive picture of the loan’s total cost per year. It is possible for two loans to have identical interest rates but differing comparison rates due to fees.
It helps to get a clearer picture, stressing the importance of considering both the interest and comparison rates.
Next, let’s delve into the fees. These charges can significantly add to your loan’s total cost. Some loans might impose monthly fees or early repayment fees, penalising you for repaying your loan sooner.
SocietyOne, however, believes in transparency and simplicity. We provide a clear fee structure without hidden charges, allowing you to plan your repayments without worrying about additional costs. Additionally, we don’t penalise early repayments, offering you the flexibility to pay off your loan sooner if you’re able.
Finally, loan terms are a pivotal point of comparison. The loan term is the period during which you’ll be making repayments. While shorter loan terms typically lead to higher monthly payments, they also result in less interest paid over the loan’s life.
In contrast, loans with longer terms generally have lower regular repayments, but you’ll pay more interest over time. SocietyOne offers flexible loan terms for both unsecured and secured personal loans, giving you the freedom to choose a loan term that aligns with your financial position and repayment capability.
As a reliable Australian financial platform, SocietyOne embodies an approachable, trustworthy, and understanding approach, providing clear and concise information to make these complex financial concepts easily understandable.
Our commitment to fixed rates, no ongoing fees, hidden charges, or early repayment fees, and flexible loan terms is part of our mission to accompany you on your financial journey, ensuring your path is paved with faster and fairer deals personalised to you.