Compare £8,500 loans
Looking for an £8,500 loan? Find out more about your borrowing options and how to get the best rates.
Compare £8,500 loans
The amount of money you can borrow with a loan often depends on your credit score and your income. The better your credit score and the higher your income, the more you are likely to be able to borrow and the better the interest rate you’re likely to secure.
The table below outlines the best £8,500 loans available, while our LoanFinder tool will help you see how likely you are to get accepted for a loan.
Late repayments can cause you serious money problems. See our debt help guides.
A loan of £8,500 can enable you to pay for major home renovations, buy a new car or even help you consolidate existing debt. You’ll receive your loan as a lump sum, which you then repay over a set term, usually between 1 and 7 years. Interest rates are typically fixed, which means your monthly repayments remain the same for the duration of the loan. What’s more, interest rates for loans of £8,500 tend to be pretty competitive, particularly if you have a good credit history.
What are my options when borrowing £8,500?
Many high street banks offer loans of £8,500, as do a number of online lenders. The type of loan you can get depends on your financial circumstances as well as your credit rating. But for most people, an unsecured loan will likely be the most suitable choice.
How do unsecured personal loans work?
With an unsecured personal loan, you don’t need to use an asset, such as your home, as collateral. This means there’s no risk of losing your asset if you can’t repay your loan.
Secured loans, on the other hand, require you to secure your loan against an asset. This means if you can’t keep up with your loan repayments, the lender can repossess this asset (usually your home) and sell it to get its money back. Secured loans are typically used for larger borrowing amounts, usually over £10,000, and they are repaid over longer terms of up to 25 years or more. Because they are less risky for the lender (but higher risk for the borrower), interest rates tend to be lower compared to those for unsecured loans.
Unsecured loans tend to be for amounts of £1,000 to £25,000 and are taken out over a term of 1 to 7 years. A longer loan term will bring down your monthly repayments, but it also means you will pay more in interest overall, making your loan more expensive.
Choosing a shorter loan term means you’ll pay less in interest, but you must make sure your monthly repayments are still affordable. It’s worth using a loan calculator to help you work out how much your monthly repayments would be depending on the length of the term.
Although most unsecured loans have fixed rates of interest, some have variable rates. This means your interest rate and monthly repayments can move up or down during the loan term.
How to get an £8,500 loan
The steps below can help you find the right loan for you:
Work out how much you need to borrow
First of all, consider whether a loan of £8,500 will provide you with the funds you need. The funds will be transferred to you as a lump sum, so it’s important to make sure this amount will be sufficient. After all, if you’re carrying out home improvements and they turn out to be more expensive than expected, it can be difficult to borrow additional funds.
On the flipside, you don’t want to end up borrowing more than you need, as you’ll pay interest on the whole amount, which can make it more expensive. So think carefully. The good news is that most lenders offer their most competitive loan rates on borrowing amounts of between £7,500 and £15,000.
Work out how long you need to borrow for
Once you’ve chosen your borrowing amount, think about the loan’s term. Ideally, you want to choose a shorter loan term as it will cost you less in interest payments, and you’ll repay the loan faster. But it’s also crucial to ensure your monthly loan repayments will be affordable.
Check your credit score
The best loan rates tend to be reserved for those with excellent credit scores. Having a low credit score means you might not be accepted for a loan, or if you are, the interest rate will be higher.
To get a better idea of where you stand, it’s worth checking your credit score before you apply for a loan. You can do this for free through services such as Experian, Equifax and TransUnion. If your credit score is poor, you can take steps to improve it, such as paying bills on time, correcting any mistakes on your credit report and ensuring you’re registered on the electoral roll. Try to also avoid making lots of applications for credit in a short space of time as this can make you look desperate for credit and lenders might not want to let you borrow.
Once you’ve carried out the above steps, you’ll be ready to compare the different loans available by using our comparison tables. Be sure to compare the interest rates on offer as well as whether there are any fees. It’s also worth reading the reviews of each product to help you choose the right deal.
Apply for your loan
If you’ve found a loan to apply for, it’s worth using an eligibility checker before you fill in the application form. Many lenders offer eligibility checkers that will show you how likely you are to get accepted for a particular loan, and as they use a “soft” credit check, they won’t affect your credit score.
Applying for a loan in full, on the other hand, requires a “hard” credit check, and this leaves a mark on your credit report for other lenders to see. Too many hard searches in a short time can have a negative impact on your credit record.
Once you’re accepted for a loan, the funds are often transferred the same day or the next working day.
Can I get a £8,500 loan with bad credit?
If you have bad credit, you might still be able to get a £8,500 loan, but the deals available to you will be more limited. These loans are also likely to have higher interest rates, which means your loan will be more expensive.
In some cases, you might be required to have a guarantor. This means a family member or close friend needs to agree to repay the loan if you cannot. They will usually need to be a homeowner and have a good credit rating.
Can I get a £8,500 loan if I am self-employed?
Getting a £8,500 loan if you’re self-employed is certainly possible, but you might not have as many loans to choose from. If you’re applying for a loan with a high street bank, you usually need 3 years’ worth of accounts and meet other criteria. Alternatively, there are a number of specialist online lenders that won’t have such strict eligibility criteria and might be more willing to offer you a loan if you’re self-employed.
How to compare £8,500 loans
As part of your comparison, make sure you look at the following:
- Interest rate. You’re more likely to secure the best loan rates if you have a good credit score. Bear in mind that the advertised representative APR only has to be offered to 51% of successful applicants. The remaining 49% might be offered a higher rate.
- Available terms. Think carefully about how much you can afford to repay each month and how long you need to repay your loan.
- Total amount payable. It’s important to look at the total amount payable by the end of the loan term, as this factors in both the amount borrowed and the amount of interest charged.
- Eligibility. Always read the eligibility criteria with care and make sure you qualify before applying.
- Early repayment terms. Check whether your lender permits early repayments and whether you might pay a fee for doing so.
- Application fees. A handful of loans might also charge a fee on application.
What would the payments be on a £8,500 loan?
|Interest rate of 5.0% fixed p.a.||Interest rate of 10.0% fixed p.a.||Interest rate of 15.0% fixed p.a.|
|1 year term|
|2 year term|
|3 year term|
What do lenders consider when assessing your creditworthiness?
Your credit record will help lenders assess whether they are happy to offer you a loan. But lenders also look at other factors, including:
- Your reason for borrowing. Lenders are more likely to offer you a loan if you’re borrowing for responsible reasons, such as paying for a car or wedding.
- Your income and expenditure. Lenders will want to see proof that you can afford your monthly repayments.
- Your employment status. Your chances of acceptance will be higher if you are in a stable job with a regular income.
Could I use a credit card instead of a personal loan?
Potentially, but you’ll need to have an excellent credit score and a good income to get a credit limit of £8,500. Even then, you might not be offered a credit limit this high. If you are, it might not be on a credit card that offers an introductory 0% period. In which case, the amount of interest you’ll pay is likely to be higher compared to a personal loan, so it won’t be the best choice.
The key to getting the right £8,500 loan for you is to shop around and compare loans carefully. Consider how much interest you will need to pay and whether you can afford the monthly repayments. Remember that a longer loan term can make your monthly repayments more affordable, but the total amount repayable will be higher.
You should also check the eligibility criteria to give you the best chance of getting approved, and you will need to check whether there are any application or early repayment fees.
Frequently asked questions
Will you be approved?
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