Unsecured Loan Guide

Getting an unsecured loan in the UK

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UK Unsecured Loan Guide

In the UK today, those looking for an unsecured loan have, broadly speaking, four different routes they can go down (excluding credit cards which are arguably a fifth option but not covered in this article). Here are the options:

High Street Banks

Recently there has been a surprising "rate war" between lenders to offer the best rate. Supermarkets like M&S and Sainsburys are trying to gain a foothold in the consumer lending market and so are offering some competitive deals, while banks like Santander and Nationwide have been fighting back. However, the catch here is that very often to qualify for these rates you have to be a customer (a Loyalty card holder in the case of some supermarkets) and even then they are very picky about who they choose. As little as one late payment on your record could invalidate you from these loans. If you can get a loan from a High Street bank though, it's probably your best option. Unfortunately for us though, the High Street banks don't talk to brokers so we can't help you with this; you'll need to go direct – good luck!

Private Lenders

If you don't qualify for High St Bank loans there is the Private Lending market where self-funded institutions have been doing well in recent times. The criteria are more flexible but you may have to pay more for your loan. Is this wrong? It's not for us to say as it is down to each individual to decide whether these rates are better than no loan at all but we do encourage all clients to be aware of the total cost of credit before accepting a loan. Our online system gives you access to several such lenders granting loans from £1,000 up to £30,000 for terms up to 5 years and all by only doing a soft credit check on you (which will not adversely affect your credit score).

Guarantor Lenders

Another market that has seen phenomenal growth during the credit crunch is the Guarantor market. If your own credit is not strong enough to achieve the loan you require but if you can get someone of a better credit standing (partner, family member or good friend) to guarantee your payments then you could be eligible for a Guarantor loan. Rates start at about 40% APR and amounts of up to £7,500 can be borrowed. Our application form will also give you access to several Guarantor Lenders.

Peer-to-peer Lending

The silver lining to the credit crunch of a few years ago was the emergence of Peer-to-Peer lenders as a credible borrowing option. How does it work? Well, instead of borrowing from greedy bankers, these websites allow you take an unsecured loan from other private individuals who are looking for a better return on their money than the banks currently offer. The websites manage the credit checking and repayments and to you the Borrower, it looks and acts like any normal loan. Our experience has been that these Lenders offer among the most competitive rates on the market and you can borrow between £1,000 and £30,000 on flexible terms with no Early Repayment Charges up to 5 years! We strongly suggest you check them out and you can use our firm to apply to a selection of them (again, all only with a soft credit check).

These are the options but, to be honest, it's not easy out there. The one further piece of advice we would give is not to apply to too many places as all these searches leave a footprint on your credit record. Pick the option most suitable for you and if you need assistance, let us know!


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Frequently Asked Questions


Does it affect my credit score to apply?    

No. All our lenders use ‘soft’ credit checks which do not affect your credit score.

How long is the online application?    

It’s quite short. We just need contact details, 3 years’ address history, 3 years’ work history, income details and what you want the loan for. It all takes about 5-6 minutes to complete.

How long does it take before the loan is paid out?    

Depending on the lender you are approved with it can be same day but most likely 24-48 hours.

What if I'm not approved for an unsecured personal loan?    

We have other options: you could look at a Secured Loan if you are a homeowner or a Guarantor Loan if you are not.

Is the loan at a Fixed or variable rate?    

All Unsecured Personal Loans we offer are at a fixed rate for the term of the loan.

What is needed to apply

Applying for an Unsecured Personal Loan is very easy. Below are listed the things you need in order to apply.

  • Eligibility CriteriaOver 18, UK resident, clean credit and sufficient earned income to make the payments (affordability)
  • Documents RequiredOnline application form, proof of ID and proof of income (payslips or bank statements)
  • Additional CommentsIf approved you can be funded within 24 hours

There are many options for getting an unsecured personal loan and at Choice Loans we endeavour to give you as wide a range of option as possible. Our online systems link straight to lenders who can give you an immediate decision in principle and approve the loan within 24 hours.

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