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How to get a personal bank loan

Julianne Leybag
03 April 2018 4 minute readShare

It is best to be prepared when taking out a personal bank loan in order to get it approved fast.. Read on to learn more.

Both business owners and private individuals reach a time in their life when they need to borrow money. There are many loan options available for every individual, one of which is taking out a personal loan from a bank.

The following must be prepared before proceeding with a loan application:

Proof of income

The documents and details needed for the applicant’s proof of income depend on the particular requirements set by the lending bank. However, most banks will require at least two of the applicant’s most recent payslips or financial statements and tax returns during the last two years if they are self-employed.

Banks will also require the most recent tax notice of assessment issued by the Australian Taxation Office (ATO).

On the other hand, employees need to be able to show their gross salary and net salary details via payslips or other equivalent documents. The gross salary is, the income before tax, while the net salary is the income less tax.

Banks could also require its applicants to provide income source details, such as employment details, business details, and other such sources of income.

Bank statements

Bank or account statements are documents containing a summary of financial activities and/or transactions occurring over a certain period of time. These documents include statements on savings, loans, and/or credit cards with other financial institutions.

Applicants could choose to get these statements online or via counter, whichever is more convenient as long as applicants follow the requirements set by the lending bank.

Personal identification

The specific personal identification documents needed to apply for a personal loan depends on the requirements by the specific lending bank. In most cases, however, banks will require applicants to provide a copy or two of valid personal identification (ID) cards containing the applicant’s photo.

Personal identification documents include the applicant’s passport, driver’s licence or firearms licence, and proof of age card.

Banks will also require applicants to submit/present their birth certificate, citizenship certificate, pension card or health care card, council rates or a utility bill, and/or an ATO assessment notice or overseas driver’s licence.

Address verification

Documents for address verification include the applicant’s utility bills or a copy of lease. A copy of lease or a rental ledger will contain a complete statement or records of all the rent payments the applicant has made including specific dates the rent covers.

Rental ledgers will also show whether the applicant’s rent has ever fallen behind. Property managers usually have rental ledgers. Tenants can also keep their own ledgers for whatever purpose it may serve them,including taking out a personal loan application from a bank.


The lending bank will also require its applicants to provide their employment information and the employer’s contact details. Employers are required by legislation to keep employee records, so it won’t be hard for lending banks to acquire information on their applicant’s employment details.

Under promolgations stated in the Fair Work Act of 2009, employers are required to keep records of dates and hours every employee has worked for them, and how much each employee was paid. The Act also requires employers to provide employees with regular payslips in hard copy and/or electronic form.

Employers are also required  to keep employee records on start and end date of employment contracts, employment agreements, overtime hours, leave accruals, and superannuation fund and contribution details. Other required documentation for employers include the employee’s contact information and bank account details for salary purposes.

All the above requirements ensure that applicants will be able to provide the necessary employment documents  when required by the lending bank.


The bank will also require applicants to submit their liability details because all banks are required to run a credit card check to determine the credit standing of their applicants.From this given information, the bank will then determine the allowed loan amount for the applicant.

Business owners need to understand that liabilities are legal and/or financial obligations payable to a third party. Liabilities are generally classified as current or long-term, and include the following:

  • Accounts payable or invoiced liabilities payable to suppliers
  • Accrued wages or compensation earned but are yet to be paid to the business owner’s employees as of the balance sheet date
  • Current portion of debt payable or any one of the portions of a long-term debt that has a payment due within one year
  • Deferred revenue or a payment by one of the business owner’s customers still to be earned by the business/company
  • Income taxes payable to the government
  • Payable payroll taxes resulting from the completion of recent payroll transaction(s)
  • Sales taxes charged to customers which the business must remit to taxing authorities
  • Debts that need to be repaid in more than one year

The lending bank will require applicants to submit their liabilities documents. These include loan balances, repayment amounts, and credit card or overdraft limits. Preparing all the necessary documents will make it easier for applicants to have their personal loan approved by the bank.

Applicants must keep in mind that while taking out a personal loan will indeed help relieve debts and other financial obligations,it is important to only borrow what is needed and repay the borrowed amount on time.

If applicants are still unsure about certain details on the specific requirements set by bank for the approval of their personal loan application, it is recommended to speak with a trusted lawyer or a relevant professional with a proven expertise on the subject matter.

How to get a personal bank loan
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Julianne Leybag

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