If you have a bad credit score it can be difficult to get approved for a loan. If that’s the case, you may be looking for lenders who provide bad credit personal loans with guaranteed approval. But are these loans available in Australia and are they legal? 

Can I get a bad credit personal loan with guaranteed approval? 

Due to responsible lending obligations, lenders are required to conduct an assessment on every eligible applicant. This means they are not allowed to provide bad credit loans with guaranteed approval. 

Banks and other lenders cannot lend to anyone who they believe cannot afford to pay it back. Therefore when you submit an application for a loan, these lenders are required to make reasonable inquiries about your financial situation. These inquiries allow lenders to access financial statements that give them a better idea of someone’s creditworthiness. 

If a lender claims to offer personal loans with ‘guaranteed approval,’ then they are not complying with the responsible lending guidelines. If you see a lender claiming to offer this type of loan product, it’s recommended to proceed with caution.

What are bad credit personal loans? 

Bad credit personal loans are a credit option available to people with poor or average credit scores. Some lenders, like Jacaranda Finance, offer this type of loan to give ‘unbankable’ Aussies an avenue to borrow money when they need it. 

Lenders offering bad credit personal loans are still required to conduct an assessment of eligible applicants. However, instead of focusing on your past financial mistakes and your credit score, these lenders prefer to put more weight on your current relationship with money. So, if you have a consistent income you’ve kept on top of your recent repayments, then you’ll have a better chance of approval. 

Bad credit loan interest rates

Bad credit personal loans are likely to have higher interest rates than a typical personal loan. This is because the people borrowing them are considered more of a risk to lend to. Many credit providers use ‘risk-based pricing’ which means the riskier the borrower is to lend to, the higher the interest rate will be. 

To get a better understanding of the interest rates offered on Jacaranda’s personal loans, visit our interest rates page. This will give you a breakdown of the interest rate and comparison rate you’ll receive depending on your credit score. 

What does my credit score mean? 

It’s important to understand your credit score before you apply for a personal loan. There are three major credit reporting bureaus which are Equifax, Experian, and Illion. Your Equifax score will be a number between 1 and 1,200, whereas your Experian and Illion score will vary between 1 and 1,000. Typically, someone with a credit score below 500 is considered to have a bad credit score. 

The information in the table below is based on Experian’s credit rating scale: 

Credit Score Rating
300 – 579 Poor
580 – 669 Fair
670 – 739 Good
740 – 799 Very Good
800+ Exceptional
Credit Score: 300 – 579
Rating: Poor
Credit Score: 580 – 669
Rating: Fair
Credit Score: 670 – 739
Rating: Good
Credit Score: 740 – 799
Rating: Very Good
Credit Score: 800+
Rating: Exceptional

How to improve your chances of approval?

If you’re worried that your credit score is going to affect your loan application, there are a few things you can do to boost your chances of approval. 

  1. Reduce your spending: When you submit an application for a loan, your lender will most likely view your bank statements. They do this to not only verify your income but to also look at your spending habits. If you overspend on take-away food, gambling, or alcohol, your lender may view you as a risky borrower. 
  2. Stay on top of your bills: If you have a bad credit score, it might be the result of missed or defaulted payments on previous bills. When lenders request your credit report, they want to see how reliable you are at paying your bills. So even if you’ve missed repayments in the past, it is recommended you stay on top of your current bills to boost your chances of approval. 
  3. Contact your lender prior to applying: Different lenders will have different eligibility requirements. Therefore if you contact your lender prior to applying, they can give you a better understanding of their requirements and what you can do to improve your chances of approval. 
  4. Improve your credit score: This is not something that can be done overnight, but improving your credit score will have a positive effect on your loan chances. Experian have a comprehensive list of tips on how to improve your credit score

What are the requirements to get a loan? 

Eligibility requirements will differ between lenders. At a minimum, most lenders will require borrowers to meet the following criteria:

  • Be over 18 years of age
  • Be an Australian citizen or permanent resident
  • Have received a regular income (for the last 90-days)
  • Have internet banking set up
  • Hold a direct contact number and email address

Alternatives to ‘bad credit loans with guaranteed approval’

Bad credit personal loans with guaranteed approval are technically illegal in Australia. That’s not to say, however, that you can’t access finance if your credit score isn’t up to scratch. You can apply for a bad credit loan with Jacaranda Finance instead.

Although we cannot guarantee approval for any applicant, we can offer you the ‘fair go’ you deserve. Instead of focusing solely on your credit report, we’ll look at other factors like your current income and spending habits. We find this gives us a better indication of your relationship with money. 

How to apply 

To apply for a Jacaranda personal loan, you’ll need to follow a few simple steps. The whole process can take as little as a few hours, however, this will depend on when you apply. If you apply during our business hours then you’re more likely to get a speedy decision on your loan.

Step 1: Scroll up and submit your online application

Step 2: Wait while your application gets assessed

Step 3: Receive your outcome by text or email 

Step 4: Sign your digital contract

Step 5: Receive your funds in under 60-seconds3

What documents do I need to provide

You’ll be required to submit the following details as part of your application: 

  • Personal details (i.e. name, address, D.O.B);
  • Your phone number and email address;
  • The reason for your loan;
  • myGov details (if you receive Centrelink benefits);
  • Online banking and employment info.

Why choose Jacaranda Finance 

Jacaranda Finance prides itself on being able to offer bad credit personal loans to Aussies when it counts. Below, we’ve listed just a few of the reasons that set Jacaranda apart from the rest. 

100% online

We’ve streamlined the loan process, making it easier and quicker than ever to access finance. Our application process is 100% online, from submitting your application to signing your contract. You can get the cash you need 24/7 whether you’re on the go or at home. 

Lightning-fast outcomes

You no longer have to wait days or weeks to get approved for a loan. We can assess your application in just 60-minutes2. We use bank statement technology to quickly assess your application to determine if a loan is right for you.

Australia’s first-ever 60 second payout

Jacaranda Finance is proud to be the first online lender in Australia to utilise instant payouts. Using the New Payments Platform (NPP), you could have the cash in your account and ready to use within 60-seconds3 of getting approved. 

Transparent practice 

We understand there is a stigma attached to the online loan industry. Jacaranda uses transparency and honesty to win customers over. That means we’ll let you know of your interest rate, comparison rate, fees and charges, and any other relevant information before you commit to a personal loan. 

Flexible repayment terms 

Unlike payday loans, our personal loans come with flexible repayment terms. Depending on the amount you apply for, your repayment term will vary between 12 and 36 months. Additionally, if you decide to payout your loan before the repayment term ends, you won’t charged an early settlement fee. 

2If applied within our standard business hours. 60-minute outcomes are not guaranteed. 
3If you have an NPP-enabled bank account.

What can I use a personal loan for?

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Debt Consolidation
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Car Repairs
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Home Renovation
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Holiday Expenses
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Unexpected or Emergency Bills
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Vet Bills
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Wedding Expenses