A Guide To Unsecured Personal Loans + Great Deals In The UK This Month

When it comes to borrowing money, no two loans are the same. Unsecured Loans are those which do not require you to guarantee the loan against your property or another asset.  Often called personal loans, they are available through banks and other lenders and offer the borrower between £1,000 and £25,000. These are traditional loans provided by high street banks and other financial institutions and should not be confused with so called “pay day loans” which are usually for smaller amounts and for ridiculously high rates of interest. If you have a notably poor credit history, it’s likely that you’ll struggle to get an unsecured loan. As such, these personal loans are not an option for everybody.

 

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Secured vs. Unsecured Loans: Which Ones Is Right For You?

If you’re looking for large amounts of credit and are not in a rush to pay it back fast, secured loans are a viable option. When it comes to repayments, they also tend to offer a larger time window than unsecured loans – meaning that there’s no rush to pay off your debt. Fixed monthly payments with this option make it easier to budget each month over the long-term, and that fact that your property acts as equity means that you can get a secured loan even with a poor credit history. However, if you do fail to keep up with repayments in a secured loan, it could lead to the loss of your home.

In contrast, unsecured loans are an ideal option if you’re looking to get hold of a smaller amount of money fast. If you agree to pay the credit off over the optimal time frame (usually between three to five years for this type of loan), the interest rates are relatively low. But if the amount you borrow is small or very high, or you fail to meet expected monthly repayments, the interest rates can be extortionate. The best deals within personal loans are reserved for those with a high credit score – and this particular type of loan may not be offered to you at all if you have a track record of poor credit.

 

What does representative rate mean?

When personal loans are advertised using a representative APR, this means 51% of successful applicants will be given the stated interest rate. If a loan is advertised as being 4% representative APR, this means 51% of accepted applicants have to get 4% as their rate. The other 49% could get a different rate (which tends to be higher and depends on eligibility – some people are rejected completely due to a poor credit history).

 

 

Top Unsecured Personal Loans

 

Under £5,000

 

Zopa Zopa_3961490

Representative APR: 6.9% to 7.9% depending on amount and term

Loan Amounts: £2,000 – £2,999

Restrictions: 1-5 years, subject to eligibility

Representative Example: If you borrow £2,500 over 3 years at a Representative APR of 7.4% fixed you would pay £77.42 monthly and £2,787.08 in total.

 

Zopa Zopa_3961490

Representative APR: 4.6% to 6.9% depending on amount and term

Loan Amounts: £3,000 – £4,999

Restrictions: 1-5 years, subject to eligibility

Representative Example: If you borrow £4,000 over 3 years at a Representative APR of 5.3% fixed you would pay £120.27 monthly and £4,329.61 in total.

 

Ikano Bank Ikano Bank

Representative APR: 5.2%

Loan Amounts: £3,000 – £4,999

Restrictions: 1-5 years, subject to eligibility

Representative Example: If you borrow £4,000 over 3 years at a Representative APR of 5.2% fixed you would pay £120.03 monthly and £4,321.08 in total.

 

 

£5,000-£15,000

 

TSB
tsb

Representative APR: 2.9%

Loan Amounts: £7,500 – £14,999

Restrictions: 1-7 year terms, subject to eligibility

Representative Example: If you borrow £7,500 over 5 years at a Representative APR of 2.9% fixed you would pay £134.46 monthly and £8,067.60 in total.

 

 

M&S Bank M&S Bank

Representative APR: 3.8%

Loan Amounts: £5,000 – £7,499

Restrictions: 1-7 year terms, subject to eligibility

Representative Example: If you borrow £6,000 over 3 years at a Representative APR of 3.8% fixed you would pay £176.61 monthly and £6,357.98 in total.

 

Sainsbury’s Bank sainsburys-bank

Representative APR: 3.0%

Loan Amounts: £7,500 – £15,000

Restrictions: 4-5 year terms, subject to eligibility

Representative Example: If you borrow £10,000 over 5 years at a Representative APR of 3.1% fixed you would pay £179.51 monthly and £10,770.60 in total.

 

The AA brand

Representative APR: 3.4%

Loan Amounts:£7,500 – £15,000

Restrictions: 1-7 year terms, subject to eligibility

Representative Example: If you borrow £10,000 over 3 years at a Representative APR of 3.4% fixed you would pay £292.35 monthly and £10,524.56 in total.

 

 

£15,000-£25,000

 

Sainsbury’s Bank sainsburys-bank

Representative APR: 2.9%

Loan Amounts: £15,001 – £19,999

Restrictions: Nectar Card Holders Only, 2-3 year terms, subject to eligibility

Representative Example: If you borrow £17,500 over 3 years at a Representative APR of 2.9% fixed you would pay £507.86 monthly and £18,282.96 in total.

 

 

Sainsbury’s Bank sainsburys-bank

Representative APR: 3.0%

Loan Amounts: £15,001 – £19,999

Restrictions: 2-7 year terms, subject to eligibility

Representative Example: If you borrow £17,500 over 3 years at a Representative APR of 3.0% fixed you would pay £508.61 monthly and £18,309.96 in total.

 

Cahoot cahoot

Representative APR: 3.0%

Loan Amounts: £15,001 – £19,999

Restrictions: 1-7 year terms, subject to eligibility

Representative Example: If you borrow £16,000 over 3 years at a Representative APR of 3.0% you would pay £465.29 monthly and £16,750.44 in total.

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Over £25,000

TSB
tsb

Representative APR: 3.88%

Loan Amounts: £25,000

Restrictions: 1-7 years, subject to eligibility

Representative Example: If you borrow £25,000 over 5 years at a Representative APR of 3.88% you would pay £459.03 monthly and £27,541.80 total.

 

First Direct
first direct logo

Representative APR: 3.3%

Loan Amounts: £25,000 – £30,000

Restrictions: First Direct Current Account holders only, 1-7 year terms, subject to eligibility

Representative Example: If you borrow £27,000 over 3 years at a Representative APR of 3.3% you would pay £788.65 monthly and £28,391.30 in total.

 

 

Sainsbury’s Bank sainsburys-bank

Representative APR: 6.8%

Loan Amounts: Over £25,000

Restrictions: 2-5 year terms, subject to eligibility

Representative Example: If you borrow £30,000 over 4 years at a Representative APR of 6.8% you would pay £712.79 monthly and £34,213.92 in total.

 

Disclaimer: TheMoneyDaily’s service is not intended to be, nor should it be construed as financial advice. We help our readers make informed decisions and can introduce you to comparison services and provide impartial information and guides. Where appropriate, we may introduce FCA authorised partners who can provide services relating to financial products.

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