Follow these three steps to find the right loan:
Decide how much you need to borrow
Choose how long you want to pay it back
Compare rates to find the cheapest loan that suits your needs
You can use our loan calculator to see how different interest rates and loan terms affect how much it will cost.
How to find the best loan
The best loan deals let you borrow the amount of money you need at the cheapest cost while still being affordable to pay back. The determining factor in the cost of a loan is the interest rate or APR, which is the percentage rate at which you will repay the loan.
The 'representative APR' is the interest rate that at least 51% of people who apply for the loan are offered. However, the interest rate you are offered depends on your personal circumstances such as your credit rating, your income and monthly expenses.
Why use our comparison site?
Our comparison table lists a wide variety of providers, ranging from large mainstream lenders to small lesser-known companies, which often have better deals to attract customers. This can help you:
Save money. You can compare the interest rates that different lenders offer.
Save time. Applying online is quick and easy, you can normally get a decision from most online lenders or banks in a matter of minutes.
Which loan should you choose?
There are different types to choose from, but the main are personal loans and secured loans.
What is a personal loan?
A personal loan is a type of unsecured loan that lets you borrow a fixed amount of money with a monthly repayment agreement.
The repayments will also include interest rates and charges set by the lender.
Personal loan interest rates are usually fixed, and you repay it in monthly instalments. For example, you might be able to borrow £20,000 over 5 years at 3% APR.
What is a secured loan?
A secured loan is one in which the debt is linked to an asset or property as security for the loan. Car loans or homeowner loans are examples of secured loans. In the event that you fail to repay the loan, the provider can repossess the asset linked to the loan. This allows the lender to offer more affordable interest rates on secured loans as compared to unsecured loans as there is less risk of incurring a loss on the loan.
If you want to borrow money for your business, you will need to compare business loans.
What is a bad credit loan?
A bad credit loan is a loan that is available to you if you a have less than perfect credit rating. It typically has a higher interest rate and more restrictions compared to other loans, as lenders look to reduce their risk if you fail to repay the loan.
What is a guarantor loan?
A guarantor loan is also a loan commonly offered to people with bad credit. With a guarantor loan you can have a family member or friend act as a guarantor to the loan. This means that if you fall behind on your repayments, it will be the guarantor's responsibility to make the repayments. This makes is more likely to get approved for a loan if you have a poor credit history.
How to compare loans
When comparing loans, it's important to consider the following features:
Eligibility: Knowing what you are eligible for can help you save time and avoid applying for loans you can't get.
Loan amount: Make sure the amount you are allowed to borrow covers your needs, while also ensuring you'll be able to keep up with the monthly repayments and repay it within the term.
Interest rate: This will determine the cost of your loan. Providers will take into account your credit history/rating and income and expenses, when they offer you an interest rate.
Loan term: The longer the loan term, the smaller the monthly repayments - but the more interest you will pay overall assuming the APR remains the same. The repayment period should be long enough that you can afford the fixed monthly payments in addition to your regular monthly outgoings.
Fees: Some lenders may charge 'arrangement fees' or 'early repayment fees' for repaying the loan early.
Check you qualify
Before you apply for a loan you should check that you meet the lender's requirements, which could include:
Earning more than a set amount, e.g. £15,000 per year
Being a homeowner
Having a strong credit record
Some lenders offer a soft quote which can tell you if you will be accepted for a loan without damaging your credit record.
Should I get a loan from a bank or an online lender?
The rise in online lenders has given customers more opportunities to find low rate loans, as traditional brick and mortar banks have to compete with the online market. Online lenders often offer lower interest rates and fees, with faster application processes and easier approval compared to banks.
While banks may charge higher interest rates and fees, the legitimacy of a physical branch and the access to in person customer service gives you peace of mind that your finances are in safe hands.