A Beginner’s Guide to Applying for a Loan

Applying for a loan is something most of us will do in our lives, but the first time applying for a loan can feel daunting. What paperwork do you need for a loan? Are there requirements? Do you need someone else to co-sign a loan? These are all normal questions we all think of when first wondering how to apply for a loan. That’s why we put together this handy guide to loans to make it all a little simpler.

Why You Might Apply for a Loan

The most common reason to apply for a loan is so you can make an investment now that will help you in the long run, but you don’t have the cash in hand. This could be anything from vehicle repairs, to home renovation, to covering education expenses. You might also consider applying for a loan if you find yourself in a tricky position and you need some extra cash to keep afloat. For example, our Centrelink Loans and Loans for Unemployment are an option for anyone who has recently lost their job. There are lots of different types of loans, so be sure you’re choosing the right one for your situation and your needs.

What You Need When Applying for a Loan

The first time applying for a loan can be confusing, especially if you can’t lean on someone else who has received a loan and can help you through it. Fortunately, all you need to get started with a Cigno Loan is:

  • Your name
  • Contact details
  • How much you want to borrow
  • What you’ll use the funds for
  • A recent bank statement.

If you ever need more help, just reach out to our Customer Service team.

Bigger loans with bigger banks will require a lot more from you when you apply with them and will likely require in-person meetings before you’re approved for a loan. In those cases, you’ll want to be prepared. Be ready to print off proof of your income (statements from your employer), bank statements, personal identification to prove you are who you claim to be (a driver’s licence, passport etc.), credit card statements, tax returns (if self-employed), current rent or mortgage statements, and an estimation of your current expenses. If you’re prepared with all that before you start applying, the application and approval process should go a lot faster. It’s possible that the lender you speak to won’t need all this information but being ready with it just in case will show your commitment and responsibility.

Can I be approved even if I have bad credit?

There is no sure way to get approved. Although there are a few pointers you can use for a better chance at bad credit loans.

You can check where you stand by examining your credit score. The higher the score is, the lesser the risk of defaulting. Your credit score can be checked in your credit report for free by using the national credit reporting bodies (CRBs) / credit bureaus listed on the Australian government website. Information such as loans acquired and applied for, as well as personal information (name, address, etc.) are also detailed in the credit report. *Note: your credit score differs depending on the credit bureau.

Bankruptcy, Part IX debt agreements, and defaults are indicators that will place you in the bad credit category. Lenders can also look at late loan repayments, late bill payments, exceeding credit card limits, and multiple loan applications as warning signs that you have bad credit. How bad your credit depends on the lender so make sure to make some enquiries or call their hotline to find out.

If you have applied for a loan before, you are well aware that multiple applications at once is frowned upon. Lenders view it as a red flag and might cause refusal to accredit future access to funds. If this is the case, wait for a while before making another application.

Paying Back a Loan

Most loans will let you pay back the lent amount with automatic payments. Some people may not like this, as they may forget the repayments are occurring and be surprised when the amount in their bank account is lower than expected. However, automatic repayments are a good idea, because a lot of lenders will charge extra fees if you miss a repayment, so forgetfulness can be a big problem. Cigno will notify and remind you of your scheduled repayments, so you’ll never be caught off guard. Do your best to stay aware of your finances as you repay your loan. Make a budget and include the repayments in your budget to stay on top of your finances going forward.

Disclaimer: Please be aware that Cigno Loans’ articles do not replace advice from an accountant or financial advisor. All information provided is intended to be used as a guide only, as it does not take into account your personal financial situation or needs. If you require assistance, it is recommended that you consult a licensed financial or tax advisor.



Ordered by the Federal Court of Australia

The Federal Court of Australia has found that Cigno Australia Pty Ltd (Cigno Australia) and BSF Solutions Pty Ltd (BSF Solutions) have breached the law by engaging in unlicensed credit activity and charging prohibited fees.

In the period from July 2022 to 3 October 2023, over 100,000 consumers have been lent a total of $34 million, and charged fees of over $70 million, under the ‘No Upfront Charge Loan Model’ operated by BSF Solutions and Cigno Australia. At no time has either BSF Solutions or Cigno Australia held an Australian Credit Licence.

The Court also found that Mark Swanepoel (director of Cigno Australia) and Brenton James Harrison (director of BSF Solutions) were involved in these breaches of the law.

With effect from 24 May 2024, the Court has granted permanent injunctions preventing Cigno Australia and BSF Solutions from:

  • demanding, receiving or accepting fees or charges, including amounts of loan principal, from consumers in relation to credit provided under the ‘No Upfront Charge Model’; and
  • engaging in further credit activity pursuant to the ‘No Upfront Charge Loan Model’, including by entering into new agreements with consumers, for so long as they do not hold an Australian Credit Licence.

Cigno Australia was ordered by the Court to, by 5th July 2024, send written communications to consumers who between July 2022 and December 2022 entered into agreements with Cigno Australia and BSF Solutions under the ‘No Upfront Charge Loan Model’.

The Court will later determine whether (among other things) Cigno Australia and Mark Swanepoel ought to pay a pecuniary penalty in respect of this conduct, and whether Mark Swanepoel should be restrained from carrying on a business engaging in credit activity.

Cigno Australia, BSF Solutions, Mr Swanepoel and Mr Harrison intend to appeal the decision of the Court and have filed an application for leave to appeal. If the appeal is successful, some or all of the orders of the Federal Court of Australia may be set aside.

Where can you get more information?

Where to go for further support

You can access legal advice in your state at: Free legal advice – Moneysmart.gov.au.

If you are experiencing trouble with debt, or money worries in general, contact:

  • the National Debt Helpline on 1800 007 007 or online chat (9:30am to 4.30pm, Monday to Friday).

If you need someone to talk to, contact:

  • Lifeline on 13 11 14 (24 hours) or their crisis support online chat or
  • Beyond Blue on 1300 22 46 36 (24 hours) or their webchat