Getting a personal loan for medical expenses

Whether it’s specialist appointments, planned surgery or unexpected health issues, managing medical bills can be an expensive ordeal with substantial out-of-pocket costs. These costs aren’t always covered by private health insurance or Medicare and may leave many individuals and families feeling concerned. 

A personal loan for medical expenses could be a viable option for covering medical costs, offering flexibility and quick access to necessary funds. Here’s some things you may want to know. 

What is a personal loan for medical expenses?

A personal loan for medical expenses is an unsecured loan to help cover healthcare-related costs. 

Unlike a secured loan, which requires an asset to back the loan security, unsecured personal loans do not require any security. This means they may be a helpful option for people who need quick access to funds to address medical needs. 

Common medical expenses covered by personal loans

A personal loan could help cover a wide range of medical expenses. These may include:

• Medical procedures: Costs for surgeries, including orthopaedic procedures 
• Optical treatment: Expenses relating to laser eye surgery 
• Dental expenses: Covering the cost of dental surgery, orthodontics (e.g., braces) and prosthodontics 
• Audiology services: Financing hearing aids or other hearing treatments 
• Plastic surgery or cosmetic procedures: Elective cosmetic surgery not typically covered by health insurance 
• Fertility treatments: Reproductive procedures, such as IVF 
• Specialist treatments: Appointments and major hospital bills 
• Vet bills: Unexpected pet expenses and pet care

How to choose the right loan 

When it comes to deciding on the right personal loan for medical expenses, as well as the loan amount, you’ll need to choose between a loan with either a fixed or variable interest rate. 

Fixed rates could provide certainty with consistent repayments, while variable rates may fluctuate. With a variable rate, your repayments may increase if interest rates rise, or they may be lower if rates fall, saving you money. 

Some variable loans, including the Westpac Flexi Loan, offer a continuous line of credit. This means that you can choose to withdraw as much as you need, whenever you need it, and only pay interest on that amount, rather than taking out the whole available balance in one lump sum and paying interest on the full amount. 

For unsecured personal loans you’ll also be able to choose the loan term (the length of the loan). Short-term loans can be paid off faster but have higher monthly repayments. A longer loan term may offer lower monthly repayments but accrue more interest over time.

It’s important to choose a reputable lender – such as a bank – as some smaller lenders may charge higher interest rates and fees. When it comes to fees and charges, be sure to understand any additional costs associated with the loan, such as establishment fees, or early repayment fees if you pay the loan out in full. 

 

Before you apply for a personal loan, you can find out how much you may be able to borrow with Westpac’s personal loan borrowing power calculator. 

And try the repayment calculator to help plan and get an idea of what your repayments may be. 

Finally, it’s also possible to get a personalised interest rate. You can get this personalised interest rate before you apply without it impacting your credit score.

• Explore Westpac personal loans

Potential benefits of using personal loans for medical expenses

Unexpected medical expenses – whether due to illness, injury or a procedure that can’t wait – may arise at any time. 

Instead of worrying about how to cover the medical costs or delaying treatment, dipping into savings or borrowing money from friends or family, taking out an unsecured personal loan may provide a simple way forward and put your mind at ease at a time when you need it most.

A potential benefit of using an unsecured personal loan for medical procedures is the ability to quickly access funds, so you can cover medical costs when they arise, without adding further stress to an already difficult time. 

It is important to note that every time you apply for credit, including a personal loan or credit card, a hard inquiry is added to your credit report. Responsibly managing your loan by not missing repayments may help maintain your credit report and credit score.

Tips for managing medical expenses effectively

To help manage medical expenses effectively, you may want to consider the following tips: 

• Ask healthcare providers for upfront costs: Don’t be afraid to ask for a breakdown of the costs for your medical procedure. Some providers might even offer lower rates for upfront payments. 
• Create a budget: Compare those upfront costs with your final accounts – if they don’t align, ask questions.
• Keep track of medical bills and payments: It sounds simple but there might be several different providers involved (e.g., anaesthetist, specialist, GP, surgeon) so keep track of all your payments to avoid missing any. 
• Explore additional resources: There may be non-profit organisations offering financial aid for medical treatments, so it’s worth doing your research. 

Eligibility criteria for personal loans for medical expenses

To qualify for a Westpac personal loan for medical expenses, borrowers must meet certain eligibility criteria, including being at least 18 years old, having a fixed Australian residential address, and having a verifiable regular income. 

Your credit score will also be considered, so it may be worth understanding what a credit score is, and checking your credit history before you apply. You can get your score for free by checking creditsmart.org.au and following the links to a free credit report.

You may be required to provide documents, including your proof of identity, proof of income, your regular monthly expenses, and any current debts in your name (including any home loans, personal loans, other credit or store cards and instalment purchases like Afterpay and Zip Pay).

How to apply for a personal loan for medical expenses

Whether you’re an existing Westpac customer or a new customer, you can complete an online application for a personal loan. You can also apply at your nearest branch or over the phone. 

If you meet all the criteria and your loan is approved, you’ll receive your contract via email. Existing customers can receive funds within the hour after signing the loan contract, if an existing Westpac account is nominated. Other nominated accounts may take up to 3 days to receive the funds*.

• Apply for a Westpac personal loan

To sum up 

From dental expenses to laser eye surgery and cosmetic procedures, it’s no surprise that medical expenses can be unexpected and costly. Understanding personal loans as a financing option for access to funds may help give you peace of mind when these situations arise.