Costs and rates
Interest rate (annual percentage rate)
The yearly rate charged on the amount you owe. It doesn't include fees.
Comparison rate
The interest rate plus most fees and charges, shown as one yearly percentage for an example loan amount and term.
Establishment fee
A one-off fee for setting up a loan. It may be added to the amount financed so you repay it over the term. For a medium amount loan, the law caps the establishment fee at $400.
Monthly fee
A fee charged each month for having the loan. Evercrest's loan has no monthly fee.
Annual cost rate cap
A legal limit on the yearly cost of credit. Medium amount loans have a 48% cap, with a separately capped establishment fee.
Reducing balance
Interest is worked out on the amount you still owe, so the interest part of each repayment falls as the balance goes down.
Total amount repayable
Everything you'll pay over the loan, including the amount borrowed, interest and fees, if all repayments are made on time.
Contract terms
Amount financed
The total credit provided under the contract. It can include the cash you receive plus any fees added to the loan.
Term
How long you have to repay the loan, such as 3 or 6 months.
Secured and unsecured
A secured loan is tied to an asset, such as a car, that the lender can take if the loan isn't repaid. An unsecured loan isn't tied to an asset.
Medium amount credit contract
A loan of $2,001 to $5,000 that runs for between 16 days and two years. It is the only kind of loan Evercrest will offer: $2,050 to $4,600 in cash, with the $400 establishment fee added to the loan.
Credit Guide
A document a lender gives you explaining its credit services, responsible lending, and hardship and complaint options.
Target Market Determination
A document describing who a credit product is designed for and how it should be distributed.
When repayments are a problem
Arrears
Repayments that are overdue and still unpaid.
Repayment history
A record on your credit report of whether repayments were made on time. A payment counts as missed if it's more than 14 days late.
Default
A listing on your credit report when $150 or more is at least 60 days overdue and the lender has sent the required notices. It generally stays for 5 years.
Dishonour fee
A fee that may apply if a scheduled payment fails, for example because there isn't enough money in the account.
Hardship request
Asking your lender for help because you can't, or soon won't be able to, make repayments. You don't need to use special words.
Hardship variation
A change to your loan contract because of financial hardship, such as lower repayments or a longer term.
Your rights and where to get help
Responsible lending
Lenders must make reasonable inquiries, verify your situation and not offer a loan that is unsuitable for you.
Australian credit licence
A licence from ASIC that lenders need to provide consumer credit. You can check a lender on ASIC's professional registers.
Check a lender on ASIC's professional registersCredit reporting body
A business, such as Equifax or Experian, that holds credit reports. You can get your report free every three months.
AFCA
The Australian Financial Complaints Authority, a free, independent service for complaints you can't resolve with a lender.
Australian Financial Complaints AuthorityFinancial counsellor
A free, independent professional who can help with debts, bills and hardship. Call the National Debt Helpline on 1800 007 007.
National Debt HelplineGlossary questions
What's the difference between a missed payment and a default?
A missed payment is a repayment more than 14 days late, which can show in your repayment history. A default is a separate listing when $150 or more is at least 60 days overdue and the lender has sent the required notices.
What does 'amount financed' mean on my contract?
It's the total credit provided. If fees are added to the loan, the amount financed is more than the cash you receive, and interest is usually charged on it.
What is a hardship variation?
A change to your contract because you're in financial hardship, such as reducing repayments for a period or extending the term. You can ask for one before you miss a payment.
What does unsecured mean?
The loan isn't tied to an asset like a car. The lender can still take steps to recover the debt if it isn't repaid, and missed payments can affect your credit report.