Transfer Personal Loan? Discover a Real Solution Fast

You've taken out a personal loan, and now circumstances have changed. Perhaps you're looking to transfer the loan responsibilities to someone else. But is this even possible? If you've found yourself asking, "Can I transfer my personal loan to another person?" you're not alone. This question is more common than you might think, and understanding the nuances can help you make informed decisions tailored to your financial needs.

Understanding Personal Loan Transfers

When you initially take out a personal loan, you enter into a contract with a lender that outlines the terms of repayment. This agreement is legal and binding, meaning the obligation to repay remains with you until the debt is satisfied. However, life is unpredictable, and situations may arise where transferring your personal loan to another person seems like an appealing solution.

Transferring a personal loan involves shifting the loan balance and its repayment responsibilities from your name to someone else's. This process isn't as straightforward as it sounds, and lenders often have varying policies on whether this is permissible. Most personal loans are unsecured, which means they are not tied to any collateral, making lenders more cautious about allowing transfers.

Loan Transfer Rates, Requirements, and Options

In Australia, the option to transfer a personal loan to another individual is largely determined by the policies of the lender. As of 2026, the interest rates on personal loans can vary significantly, typically ranging from 6.49% to 12% depending on the borrower's creditworthiness and the lender's criteria.

Here are some key points and requirements you should know:

• Most lenders in Australia do not allow direct transfers of personal loans to another person. This is primarily because the loan is unsecured, and lenders assess the risk based on the original borrower's financial profile.
• Some lenders might offer solutions such as refinancing the loan under the new borrower's name. This involves the new borrower applying for a new loan to repay the existing one.
• The new borrower must meet the lender's eligibility criteria, which typically includes a good credit score, stable income, and a favourable debt-to-income ratio.

Steps to Transfer or Refinance a Personal Loan

While direct transfers are not commonly permitted, you can consider refinancing as an alternative. Here’s how you can go about it:

1. Assess the New Borrower's Financial Standing: Ensure the individual who will take over the loan has a strong credit profile and meets basic eligibility criteria.
2. Discuss with Your Lender: Contact your lender to discuss possible options, such as refinancing. Some lenders on Esteb and Co's panel may have flexible solutions tailored to your needs.
3. Apply for a New Loan: The new borrower applies for a personal loan either with the same lender or through another lender. Esteb and Co can assist with finding suitable options across our 83+ lenders.
4. Use the New Loan to Pay Off the Existing Loan: Once approved, the funds from the new loan are used to settle the outstanding balance on the original loan.
5. Sign New Loan Agreement: The new borrower will now be responsible for repaying the new loan as per the agreed terms.

Tips and Considerations

When contemplating a loan transfer or refinancing, keep the following expert tips in mind:

• Credit Scores Matter: Both parties should be aware of the impact on their credit scores. The original borrower's score may improve upon settling the loan, while the new borrower's credit profile will be evaluated rigorously.
• Understand the Costs: Refinancing may involve fees such as application fees or early repayment fees on the original loan. Calculate these costs to ensure the transition is financially viable.
• Communicate Clearly: Maintain open communication with all parties involved, including the lender, to avoid misunderstandings and ensure a smooth transition.
• Seek Professional Advice: Consider consulting with a financial advisor or mortgage broker from Esteb and Co to explore your options and receive guidance tailored to your situation.

Frequently Asked Questions

• Can I transfer my loan to a family member?
  Most lenders do not allow direct transfers, but refinancing in the family member’s name is a potential solution.
• Will transferring a loan affect my credit score?
  Yes, settling your loan can improve your score, while the new borrower’s credit profile will be scrutinised.
• What if my lender doesn't allow refinancing?
  Explore options with other lenders. Esteb and Co can help you find a lender that meets your needs from our extensive panel.
• How long does the refinancing process take?
  It varies, but typically the process can take a few weeks, depending on the lender and the new borrower's financial profile.
• Are there any fees involved in refinancing?
  Yes, there may be fees such as application fees, early repayment fees, or administrative fees. It's important to discuss these with your lender.
• Can a bad credit score impact the new borrower's application?
  Yes, a poor credit score can lead to higher interest rates or rejection of the loan application.
• Does refinancing always save money?
  Not necessarily. It’s important to calculate total costs and compare them to the benefits before proceeding.