Compare low-interest personal loans

Need a personal loan? A low interest rate can help you save big.

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Compare low-interest loans

Table: sorted by representative APR, promoted deals first
Name Product Total Payable Monthly Repayment Representative APR Link
Royal Bank of Scotland Existing Customer Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.4% p.a. (fixed). Representative APR 3.4% and total payable £10,524.24 in monthly repayments of £292.34.
Post Office Money® Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.1% p.a. (fixed). Representative APR 3.1% and total payable £10,478.16 in monthly repayments of £291.06.
Halifax Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.9% p.a. (fixed). Representative APR 3.9% and total payable £10,601.64 in monthly repayments of £294.49.
M&S Bank Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 2.8% p.a. (fixed). Representative APR 2.8% and total payable £10,431.72 in monthly repayments of £289.77.
Barclays Bank Existing Current Account Customer Barclayloan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 7.9% p.a. (fixed). Representative APR 7.9% and total payable £11,219.04 in monthly repayments of £311.64.
first direct Existing Customer Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.3% p.a. (fixed). Representative APR 3.3% and total payable £10,509.12 in monthly repayments of £291.92.
Bank of Scotland Existing Customer Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 4.4% p.a. (fixed). Representative APR 4.4% and total payable £10,678.68 in monthly repayments of £296.63.
MBNA Limited Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.1% p.a. (fixed). Representative APR 3.1% and total payable £10,478.16 in monthly repayments of £291.06.
Barclays Bank Existing Premier Account Customer Barclayloan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 4.3% p.a. (fixed). Representative APR 4.3% and total payable £10,663.20 in monthly repayments of £296.20.
Bank of Ireland UK Online Personal Loan
View details
Representative example: Borrow £15,000.00 over 3 years at a rate of 3.2% p.a. (fixed). Representative APR 3.2% and total payable £15,740.28 in monthly repayments of £437.23.
Danske Bank Existing Choice, Prestige or Freedom C/Acc Customers
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.3% p.a. (fixed). Representative APR 3.3% and total payable £10,509.12 in monthly repayments of £291.92.
Sainsbury's Bank Standard Non-Nectar Cardholder Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.5% p.a. (fixed). Representative APR 3.5% and total payable £10,539.72 in monthly repayments of £292.77.
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Interest is one of the top costs to consider when comparing personal loans. A low rate can mean lower costs, but you’ll likely need good credit to qualify. This guide walks you through how low-interest loans work.

Please note: You should always refer to your loan agreement for exact repayment amounts as they may vary from our results.

Late repayments can cause you serious money problems. See our debt help guides.

What’s considered a low-interest personal loan?

Market rates vary over time, but right now, a loan that comes with an annual percentage rate (APR) below 10% would broadly be considered “low rate”. It works like any other personal loan: It’s money you borrow to cover an expense, which you pay back plus interest and fees. The main difference is that they tend to cost less than your average personal loan, thanks to the low interest rate.

Rates will vary depending on the loan amount and term you’re after — lenders can’t make as much profit as they might like from, say, a £2,000 loan over one year with an APR of 4%.

To qualify for a low-interest loan from most traditional lenders, you typically need to have a high credit score and a strong financial history.

Doesn’t sound like you? You still have low-interest options. Those with a less than perfect credit score might want to look at loans secured with collateral or borrow from credit unions or peer-to-peer lenders, which tend to offer lower rates than other direct lenders.

Who gets the lowest rates?

You might think that all you need to get that 3% APR is a reasonably good credit score, but the truth is that very few people can qualify for a lender’s absolute lowest rate.

Lenders only offer these low rates to ideal candidates: People who borrow over a certain amount, have a six-figure income and almost no debt. In other words, the kind of person that probably doesn’t need a loan. The average interest rate for people with excellent credit is actually just around 9%.

How does applying for a low-interest personal loan work?

If you find a personal loan you’re eligible for, you can either apply online, in person or over the phone, depending on your lender. Many online lenders have pre-qualification options, which give you an estimate of what type of interest rates you might be eligible for without a hard credit check.

After you submit your application, an underwriter (or underwriting software) reviews your file and pulls a hard credit check — which will cause a temporary dip in your credit score. At this point you might be asked to submit additional documentation like bank statements, tax forms or pay stubs.

If you’re approved for an online personal loan, the money is transferred into your bank account electronically. You then have to make repayments on a monthly basis until your loan is paid off.

Things to consider besides interest

Interest is important , but it’s not the only thing that makes a loan competitive. Compare these other features when looking for a personal loan:

  • Loan security. If you cannot provide any collateral, your options are limited to low-interest unsecured personal loans. By providing some kind of security you can get a lower APR.
  • Loan amount. Different lenders offer low-interest unsecured personal loans for amounts from £500 to £50,000. The maximum you can borrow depends on your creditworthiness, your existing financial situation and your ability to make repayments.
  • Loan fees. Some online loans come with origination fees — typically between 1% and 5% of your loan amount — which is factored into your APR. There are other fees you might want to look out for that don’t get included in your rate, such as prepayment penalties, late fees or fees for having insufficient funds. You could also consider a no-fee personal loan if you have very good credit.
  • Loan term. Getting a loan term that matches your requirement may be easier than you think. You can normally find low-interest personal loans with terms from two to seven years.
  • Processing time. If you need money in a hurry, this aspect requires particular attention. Certain lenders can give you access to funds on the day you apply, or by the next business day. For others, you may have to wait for as long as seven to 10 business days.

Where can I find a low-interest personal loan?

In your search for low-interest personal loans you’ll come across these options:

  • Peer-to-peer lenders. Peer-to-peer lending platforms that offer peer-to-peer personal loans connect investors with borrowers. With good or excellent credit rating you can get competitive interest rates.
  • Credit unions. Credit unions don’t have any shareholders so they transfer their profits to their members through competitive interest rates and little to no fees. Not all credit unions offer membership to the public at large.
  • Secured loan providers. Some lenders allow you to secure your personal loan against an asset – usually property. In return, you could access a lower APR.
  • Banks. If you have excellent credit, you might be able to qualify for a low-interest bank loan. You might even be eligible for a discount if you already have an account with them.

Consider these benefits and drawbacks before applying

  • Savings. If you take a low-interest personal loan that you wish to repay in a few years, you can end up saving a tidy sum in interest.
  • Easy process. With widespread usage of the Internet, getting a personal loan has become considerably simpler. You can now apply using any Internet enabled device, and some lenders provide apps for mobile devices as well. Many lenders let you complete the identification process online.
  • Repayment flexibility. You can find lenders that let you make payments as per your pay schedule, be it weekly, fortnightly or monthly. Some let you repay your loan early without charging any extra fees or penalties.
  • Early repayment penalties. Find out if you may have to pay early repayment penalties because these can put a dent in your plans if you plan to repay your loan ahead of time.
  • Scams. The online world is not devoid of unscrupulous characters. Before you apply for a low-interest personal loan online, find out if the lender you choose is legitimate by looking them up on the Financial Conduct Authority (FCA) register or through the government’s Companies House website.
  • Bad credit is a problem. Finding low-interest personal loans for bad credit is near impossible, unless you consider getting a secured loan.

Frequently asked questions

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