A secured loan means you provide collateral, such as your car or property, as security against the loan in case you cant afford your repayment - in the same way a home loan is secured to the property the loan is being used to purchase. lenders typically offer lower interest rates on secured loans vs unsecured loans because there is less risk involved.

With an unsecured loan, you are not required to put up another asset, such as your car or property, as security. Instead the lender will rely on your credit score when deciding whether or not to approve you for the loan. Interest rates can be higher than a secured loan and your borrowing capacity may be limited compared to that of a secured loan.

As the name suggests, a variable rate loan means your interest rate will fluctuate when factors, such as the official cash rate, affect the lending market. A variable rate loan can offer you flexibility - such as the ability to make extra repayments or pay off your loan early - but budgeting can be trickier as your repayment amount will change when interest rates rise or fall.

A fixed rate loan means your interest rate will be locked in for a set period of time. You’ll have a little less flex with a fixed rate; for example, break fees may apply if you wish to pay your loan out before the fixed term ends. The benefits? Budgeting will be easier as your repayments will remain consistent and you wont be impacted when interest rates rise.