How to get approved for a £15,000 loan at a low rate
Find out your options when seeking to borrow £15,000 plus advice on making the best possible case for yourself.
Comparison of £15,000 personal loans
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Whether you want to renovate your house, consolidate debt or buy a new car, £15,000 can be a game-changing sum of money. But it’s a significant sum for a lender too. If you’ve got good credit, then you can make meaningful savings by comparing the market-leading rates, and if you’ve got bad credit you may need to consider securing the loan against your property.
What are my options when borrowing £15,000?
Your available options for a £15,000 loan will depend on your credit score. Lenders tend to be more picky for sums of this size than they do for smaller loans. But even if the most favourable terms are out of reach, there are providers offering loans of this size to those with bad credit.
Can I get a £15,000 loan with bad credit?
If you’re worried about your credit score, then understandably you won’t want to just apply to the first lender you come across.
A good loan matching service can help you to check which lenders would approve you for a loan (plus the actual rates they would offer you), in a matter of minutes and without affecting your credit score. A loan matching service is a broker that runs “soft search” credit checks with a number of lenders to see which would approve you. You’ll need to fill in a short online form, but it’s a lot faster than going to multiple lenders individually.See which lenders will approve you
Many lenders will be willing to lend out £15,000 without security if you have very good credit, but if you don’t, then specialist lenders might still offer you an unsecured loan. These lenders will promote the fact that they look at more than just your credit score when considering your application, but they’ll also hike up the rates to mitigate the risk they’re exposed to – potentially charging upwards of 40% p.a.
In this situation, you do have a couple of other options. You could apply for a guarantor loan, where you apply with a friend or relative (who has good credit) who promises to step in and repay the loan if you can’t. In certain situations, guarantor loans can allow you to access larger loans and/or lower rates than you might alone, but they do still come with painfully high rates – typically around 35-50%.
Note that £15,000 is the largest amount you can borrow with a guarantor loan, but some lenders will only allow a £10,000 loan if your guarantor is not a homeowner.
Alternatively, if you own a home with a mortgage, you could consider using the equity in your property as security. Secured loans could offer rates of around 7-15%, but require very careful consideration. For one thing you’re putting your home on the line, and for another, if you borrow £15,000 at, say, 11% p.a. over 15 years, the length of the loan could make it a false economy. Secured loans are commonly used for debt consolidation, where they can prove smarter than an expensive “stop-gap” loan which doesn’t solve financial problems but just defer them.
Secured vs. unsecured £15,000 loans
With a secured loan, you’ll be asked to put forward an asset (usually a property) that the lender can sell to recoup their losses if you don’t pay the loan back. With an unsecured loan, it’s not necessary to put down any collateral.
Lenders typically ask for security when there’s more risk involved – for larger sums, longer terms, lower credit profiles or some combination of these.
Unsecured loans typically apply a fixed rate of interest, meaning borrowers can budget with certainty – knowing their monthly repayment figure will remain the same over the course of the loan, and also knowing in advance what the loan will cost overall. Secured loans, which are effectively second-charge mortgages, usually involve longer loan terms, so lenders won’t be willing to fix for the full loan term (although they may offer an introductory fixed-rate period).
It’s worth noting that lenders issuing unsecured loans can still take legal action against a borrower to get any money they’re owed, however.
What about a £15,000 guarantor loan?
If you have a poor or limited credit history and can’t get a standard personal loan, you could consider a guarantor loan. £15,000 is the absolute maximum you can borrow with an unsecured guarantor personal loan, and in fact many guarantor loan companies won’t stretch this far.
When it comes to selecting a guarantor who is comfortable to financially back your loan, they’ll need to be a homeowner with an excellent credit score. They may also need to have a decent amount of equity in their home – so a first-time buyer with a short period on their mortgage may not be eligible.
With £15,000 being such a large amount, in order to keep monthly payments affordable, most of us would require a longer loan term. Most guarantor lenders expect the £15,000 to be paid back over a maximum of five years. However even over a term as long as this, the monthly repayments are still likely to come in at more than £450, with the best guarantor loan interest rates currently around 30%.
Getting approved for a £15,000 guarantor loan
Most lenders aim to process and approve your application the same day. However, there are factors which can delay the application, or even result in it being rejected. If both you and your guarantor make sure your application form is accurate and honest, you will increase your chance of a speedy approval.
- Be realistic about what you can afford. The average £15,000 guarantor loan requires monthly payments over £450. Are you confident you can meet this amount every month? Does your guarantor realise the monthly amount they would be expected to cover if you couldn’t make a payment?
- Make sure you are accurate and honest in your application form. You and your guarantor must be open with each other about your respective finances. Also double check that the application form is correct to avoid delays.
- Check the minimum eligibility criteria. Make sure both you and your guarantor fulfil the separate criteria, such as minimum age, credit rating and that you don’t have shared finances.
- Choose your guarantor carefully. If the lender likes your guarantor, you will stand a much better chance of getting your loan quickly.
- Prep your guarantor. Make sure your guarantor is aware of the responsibility they are taking on, and is on hand to complete their part of any online forms and, if necessary, available to speak with the lender over the phone. It’s also the guarantor who actually receives the funds from the lender, so you’ll need them to transfer the funds to you.
- Be available. Both you and your guarantor need to be able to take a phone call from the lender or to respond to emails during the approval process.
How much does a £15,000 loan cost each month?
|5% annual interest rate||10% annual interest rate||25% annual interest rate|
|Over 2 years||£658||£692||£801|
|Over 3 years||£450||£484||£596|
|Over 4 years||£345||£380||£497|
|Over 5 years||£283||£319||£440|
How much does a £15,000 loan cost overall?
|5% annual interest rate||10% annual interest rate||25% annual interest rate|
|Over 2 years||£15,794||£16,612||£19,214|
|Over 3 years||£16,184||£17,424||£21,470|
|Over 4 years||£16,581||£18,261||£23,873|
|Over 5 years||£16,984||£19,122||£26,416|
How do the repayments work?
Here’s an example of a £15,000 loan at a fixed rate of 7% over five years. You can see that in early repayments, you’re actually paying a relatively large amount of interest (the grey bit), and chipping away at the capital more slowly. But towards the end of the loan, each repayment goes almost entirely towards clearing the original sum borrowed.
Each bar represents an individual monthly repayment – you can hover/click to get a closer look at what’s going on in a particular month.
How do lenders assess creditworthiness?
It’s not just your income and your credit score that lenders will consider when assessing your creditworthiness. Most will ask what the money is being borrowed for, using your answer to judge how likely you’ll be to pay it back on time. They’ll also want details of your employment status in order to make a judgment about your job security.
Need £15,000 for business purposes?
Most personal loan contracts forbid borrowers from spending the money on a business. However if you wish to borrow £15,000 to start or grow a small business, there’s a wide selection of business loans (including government-backed loans) available from both standard and specialist lenders.
Frequently asked questions
Will you be approved?
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