When you’re not paying personal loan fees, you can do more.

Man on grass phone call
Home  >  Articles   >   When you’re not paying personal loan fees, you can do more.

Think about the last time you had a personal loan. What were your repayments?

Depending on where you got your personal loan, there’s a significant chance you were spending a good amount of money paying back personal loan fees rather than on the thing you borrowed for in the first place.

Personal loan fees have been normalised as part of borrowing for many years. They’re just there. Yet, we often don’t consider their impact on our borrowing capacity.

What if the fees weren’t there?

  • On a home renovation loan, you could potentially afford nicer doorknobs or marble worktops for your kitchen reno.
  • On a car loan, you could consider buying a higher spec vehicle.
  • On a travel loan, you could stay in a better hotel or take an extended trip.

What personal loan fees are lenders hitting you with when you borrow?

Application and Establishment fees

Some lenders still charge you a fee simply for applying for a loan without telling you whether you’re eligible or what your rate will be. Others don’t have an application fee but do charge establishment or set-up fees. These upfront fees will often be built into the comparison rate, with the actual amount you’re paying buried in the small print.

Upfront fees can often be up to $600 (Mozo, 2020).

Maintenance fees

These are typically administration and management fees. Some lenders actually charge these monthly, while others bundle them all into your overall borrowing and comparison rate. Say you borrow for 84 months, and a monthly fee of $15 applies; that’s $1,260 added straight onto what you owe.

Imagine what you could do with an extra $1,260 in borrowing capacity.

Additional repayment fees

Have the opportunity to clear your debt quicker and wish to do so? That’s great, but many lenders will make you pay for the privilege.

Early termination fees

If you’re lucky enough to not have to pay personal loan fees every time you make an extra payment, you might still get hit with an early termination fee if your extra repayments help you pay off your loan early.

While you’ll still typically save money by exiting your loan early, your lender will often want to minimise their losses by charging fees based on the time left on your loan term and your interest rate.

How to spot a loan with high fees

If there’s a significant jump from the interest rate to the comparison rate, the loan you’re looking at is loaded with fees.

Even if the comparison rate isn’t significantly higher, remember that it won’t include things like additional repayment or early termination fees, so ensure you check the loan terms before you apply or accept an offer.

With a NOW Finance personal loan, you pay no fees and get none of the bank

Remember the things we said you could do if you weren’t paying fees? Just two fees examples in this guide could lead to your loan being over $3,000 more expensive than it needs to be.

All NOW Finance personal loans have no fees, giving you extra borrowing capacity and enabling you to spend your money on whatever you want, rather than paying more than you should be for your loan.

Check if you’re loan eligibility and get your guaranteed rate NOW, and enjoy a personal loan with no fees and none of the bank.

Disclaimer:  This article contains general comments and recommendations only.  This article has been prepared without taking account of your objectives, financial situation or needs.  Before taking any action you should consider the appropriateness of the comments made in the article, having regard to your objectives, financial situation and needs. If this article relates to the acquisition, or possible acquisition, of a particular credit product you should obtain and consider the relevant disclosure documents before applying for the product.


Demystifying Personal Loan Fees and Features, Mozo website, 26 August 2020, Mozo Pty Ltd. Available from https://mozo.com.au/personal-loans/guides/demystifying-personal-loan-fees-and-features/51

Get your personalised rate in less than 2 minutes

why now

Why NOW?

We provide a range of personal loans designed specifically to meet the needs of our customers...
Learn more
Contact us

Contact Us

If you have any questions, please contact us on 1300 275 669 - Monday to Friday, from 9am to 6pm (Me..
Learn more

About us

Our personal loans aren’t just personal by name, they’re personal by nature...
Learn more