How to get a £200,000 loan

Estimate costs, compare rates and learn the criteria you'll need to meet for approval.

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The UK's largest range of secured loans

  • Loans from £1,000 to £2,500,000
  • See your quote before you apply
  • Quote won’t affect your credit score
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage or any other loan secured on it.

£200,000 loan calculator

Table: sorted by overall cost for comparison (representative APRC)

Property value

Current mortgage

Loan term

Data indicated here is updated regularly
Name Product Maximum LTV Loan amounts Loan terms Overall cost for comparison Monthly repayment Total payable
Paragon Personal Finance Prime Rate Secured Loan
65%
£30,000 to £500,000
10 to 30 years
3.6% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
60%
£100,000 to £500,000
10 to 30 years
3.6% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
60%
£100,000 to £500,000
10 to 30 years
3.8% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
70%
£30,000 to £500,000
10 to 30 years
3.8% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
65%
£30,000 to £500,000
10 to 30 years
3.8% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
70%
£30,000 to £500,000
10 to 30 years
4% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
75%
£20,000 to £250,000
5 to 25 years
4.3% APRC
£
£
Evolution Adverse Secured Loan
65%
£10,000 to £500,000
3 to 25 years
4.5% APRC
£
£
Paragon Personal Finance Prime Rate Secured Loan
75%
£20,000 to £250,000
5 to 25 years
4.5% APRC
£
£
Evolution Adverse Secured Loan
70%
£10,000 to £500,000
3 to 25 years
4.6% APRC
£
£
United Trust Bank Ltd Secured Loan
70%
£125,001 to £400,000
3 to 30 years
4.8% APRC
£
£
United Trust Bank Ltd Secured Loan
65%
£125,001 to £400,000
3 to 30 years
4.8% APRC
£
£
Optimum Credit Prime Rate Secured Loan
50%
£7,500 to £200,000
3 to 30 years
5.1% APRC
£
£
Evolution Adverse Secured Loan
75%
£10,000 to £200,000
3 to 25 years
5.2% APRC
£
£
United Trust Bank Ltd Secured Loan
75%
£125,001 to £250,000
3 to 30 years
5.5% APRC
£
£
Optimum Credit Prime Rate Secured Loan
60%
£7,500 to £200,000
3 to 30 years
5.7% APRC
£
£
Optimum Credit Prime Rate Secured Loan
70%
£7,500 to £200,000
3 to 30 years
5.9% APRC
£
£
United Trust Bank Ltd Secured Loan
65%
£125,001 to £400,000
3 to 30 years
6.5% APRC
£
£
United Trust Bank Ltd Secured Loan
70%
£125,001 to £400,000
3 to 30 years
6.5% APRC
£
£
Optimum Credit Prime Rate Secured Loan
80%
£7,500 to £200,000
3 to 30 years
7.4% APRC
£
£
United Trust Bank Ltd Secured Loan
75%
£125,001 to £250,000
3 to 30 years
7.8% APRC
£
£
Optimum Credit Prime Rate Secured Loan
90%
£7,500 to £200,000
3 to 30 years
8% APRC
£
£
United Trust Bank Ltd Secured Loan
65%
£125,001 to £400,000
3 to 30 years
8.9% APRC
£
£
United Trust Bank Ltd Secured Loan
70%
£125,001 to £400,000
3 to 30 years
8.9% APRC
£
£
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Overall representative example
If you borrowed £35,000 over a 14-year term at 8.95% p.a. (variable), you would make 168 monthly payments of £418.88 and pay £70,371.84 overall, which includes interest of £30,326.84, a broker fee of £3,550.00 and a lender fee of £995.00. The overall cost for comparison is 11.8% APRC representative.

Can I get a £200,000 loan?

There are plenty of companies willing to lend £200,000 to suitable applicants. They’ll be looking for homeowners with enough equity in their property to secure the loan against, and they’ll also want to see that you’re able to afford the repayments on a £200,000 loan.

While your credit record won’t be the be-all-and-end-all, lenders will take it into consideration. If you have bad credit it’ll likely affect the interest rate you’re offered.

How much equity do I need for a £200,000 loan?

This depends on the loan’s maximum allowable “LTV” (loan-to-value ratio).

For example, if your house was worth £500,000, and you had £200,000 still owing on your mortgage, a homeowner loan specifying a maximum LTV of 80% could allow you to borrow an additional £200,000.

Each loan application is considered on its own merit though, so having sufficient equity doesn’t guarantee approval. But alongside being able to afford the repayment schedule, having sufficient equity gives you a much better chance of getting your application for a £200,000 loan across the line.

How much are payments on a £200,000 loan?

The loan illustrations below use approximate, rounded figures, based on a flat interest rate. Longer-term secured loans are likely to have variable interest rates. If the rate goes down during the course of the loan, the monthly and overall costs would decrease. If the rate rises during the course of the loan, the monthly and overall costs would increase. Current interest rates are low compared to historical averages.

3% p.a. interest 5% p.a. interest 7% p.a. interest
10-year term £1,931 £2,121 £2,322
15-year term £1,381 £1,582 £1,798
20-year term £1,109 £1,320 £1,551
25-year term £948 £1,169 £1,414

How much does a £200,000 loan cost overall?

3% p.a. interest 5% p.a. interest 7% p.a. interest
10-year term £231,746 £254,557 £278,660
15-year term £248,609 £284,686 £323,578
20-year term £266,207 £316,779 £372,144
25-year term £284,527 £350,754 £424,068

How much income do I need for a £200,000 loan?

You’ll need to have a monthly income which is stable enough and sufficient enough to cover the monthly repayments. The monthly repayments themselves will be dictated by the length of the loan (generally speaking, the longer the loan, the lower the monthly repayments), the interest rate you’re offered and any product or broker fees that might be bundled in with the amount borrowed.

Homeowner loans tend to involve relatively long loan terms, and as such, lenders are usually not willing to fix interest rates beyond an introductory period lasting 1-5 years. It’s crucial to note that where variable interest rates are involved, your monthly repayment could go up. Both you and any potential lender will want to be confident that your income should be able to cope with an increase in that monthly repayment figure.

Ultimately your income is just one important part of the picture on which a lender will assess your case.

Loan companies might specify a minimum income requirement in their basic lending criteria (example below), however meeting these entry-level criteria means that your application can be assessed for approval, not that approval is guaranteed.

A minimum income requirement taken from the lending criteria for Masthaven second-charge mortgages

What credit score do I need for a £200,000 loan?

When you use the equity in your home as security, your credit score becomes a less crucial factor – but it remains a factor. The importance given to your credit score can vary from lender to lender (with some lenders specifically aiming to serve those with bad credit) but broadly speaking, if you have a lower credit score, you’re likely to be offered a higher interest rate.

How long does it take to get a £200,000 loan?

Secured loans can take 2-3 weeks to arrange and draw down. Although there aren’t solicitors involved, a property valuation will be required and if there’s an existing charge over the property, the first charge holder will need to give its approval.

These extra steps make secured loans a little slower than some other forms of borrowing, but the trade-off can be access to lower rates and/or larger sums.

How long does it take to pay off a £200,000 loan?

You can adjust your loan term in order to make your monthly repayments more affordable. Similarly, you can increase your monthly repayment in order to clear the loan in less time. As a general rule of thumb, spreading repayments over a longer timeframe normally makes for lower monthly repayments (but a higher overall cost). So it really depends on what you can afford to repay each month.

At a fixed annual rate of 3.0%, a £200,000 loan would take over 18 years to repay if your monthly repayment was £1,200. If you wanted to keep the monthly costs down, and paid £900 each month, it would take more than 27 years.

How do I get approved for a £200,000 loan?

Here are some of the key factors that will matter to a would-be lender weighing up your application:

  • The amount of equity in your home (if you’re applying for a homeowner loan). This is how much of the property you actually own, i.e. the current market value of the property minus whatever is still owing to your mortgage provider. The more equity there is in the property, the greater the chance that the lender would be able to recoup its losses if you defaulted on the loan.
  • Your regular income and outgoings (and those of any co-signatories, if it’s a joint application). This is crucial when determining whether or not the monthly repayments would be affordable for you. Lenders will want to know what debt you’re currently carrying and how much that’s costing you each month. If your reason for seeking a new loan is debt consolidation, then naturally this will be taken into account. Lenders will also consider the source of your income and how stable it is.
  • Your credit history. This is a file kept by credit reference agencies which records your borrowing history. Lenders will be hoping to see that you have a history of using credit responsibly. CCJs are also logged in your credit report.
  • What you want the money for, i.e. the loan purpose. Lenders are pretty open-minded when it comes to the loan purpose, but may have a defined list of acceptable purposes or a defined list of unacceptable purposes.
  • Some routine eligibility criteria like UK residency (some lenders will specify that you must have been a UK resident for a specific amount of time) and your age (both minimum and maximum).

How to get a £200,000 personal loan

  1. Work out your budget. Our calculator can help you get an idea of how long a term you’d need to spread the loan over in order to get manageable monthly repayments. As a general rule of thumb, you should aim to clear the loan in as short a time as possible, while ensuring the monthly repayments are affordable. Loans with longer terms tend to come with a variable interest rate (although some secured loans offer an introductory fixed-rate period), so it’s sensible to leave yourself a bit of leeway so that if rates rise, you’ll be able to take it in your stride.
  2. Get to know your credit record. Knowing your credit score is helpful for understanding what options are available to you. For many lenders, you’ll need a good credit score in order to be approved for a £200,000 loan. Plenty of companies can help you get free visibility of your credit report that’ll let you know how you’re tracking. If your credit score doesn’t appear to be good enough, consider applying for a smaller loan or building your credit score first and applying at a future date.
  3. Shop around or, better still, consider a broker (sometimes called a “loan-matching service”). It’s generally a bad idea to simply go straight to one lender and apply. You should always compare multiple lenders online and look for the best price for the amount you need. For a loan as big as £200,000 even a slightly better rate can translate into thousands of pounds saved. A decent broker or loan-matching service can take your details and check your eligibility against products from multiple lenders in one go – saving you a lot of time (and hopefully money too). A number of lenders (such as Masthaven) actually only offer their loans through brokers.
  4. Apply. Perhaps the easiest way to apply for a £200,000 loan is with the help of a good broker. You’ll provide some basic details, agree to a credit check and the indicative result of your application will usually be made available within seconds. Bear in mind that you should only ever formally apply for credit when you’re pretty confident that you’ll get approved (lenders and brokers can help you to establish this beforehand). Each application for credit usually involves a search of your credit file, which causes a small (and usually short-lived) negative effect on your credit score.

Should I just remortgage?

Remortgaging is a popular strategy for homeowners to get hold of huge lump sums. This involves altering your mortgage deal and borrowing against the equity of your property. If you’ve got a lot of equity or can bag a low mortgage rate, this could prove more economical than a personal loan.

Full guide to remortgaging

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