How much money do you need to earn to get a personal loan?

Lender	Minimum age	Minimum income	Customer type	Link
RAC Personal Loans	21	£15,000	Not specified	Check eligibility
Lendable	18	£800 per month	Not specified	Read our review
Everyday Loans	18	No minimum income specified	Not specified	Check eligibility
Guarantor My Loan	18	No minimum income specified	Not specified	Check eligibility
118 118 Money	18	£700 per month	New or existing customers	Check eligibility
NatWest	18	No minimum income specified	Existing customers only	Check eligibility
Royal Bank of Scotland	18	No minimum income specified	Existing customers only	Check eligibility
Bamboo	18	No minimum income specified	New or existing customers	Check eligibility
1plus1 Loans	18	No minimum income specified	New or existing customers	Check eligibility
Zopa	20	£12,000 per year	New or existing customers	Read our review
Fluro	20	£850 per month	New or existing customers	Check eligibility
Koyo	21	No minimum income specified	Not specified	Check eligibility
My Community Bank	21	£18,000 per year	New or existing customers	Check eligibility
Post Office Money	21	£12,000 per year	New or existing customers	Check eligibility
AA	21	£12,000 per year	New or existing customers	Check eligibility
Shawbrook Bank	21	£15,000	Not specified	Check eligibility
Bank of Scotland	18	No minimum income specified	Existing customers only	Read our review
Barclays Bank	18	No minimum income specified	Existing customers only	Read our review
Ulster Bank	18	No minimum income specified	Existing customers only	Read our review
AIB	18	No minimum income specified	New or existing customers	Read our review
Halifax	18	No minimum income specified	New or existing customers	Read our review
Virgin Money	18	No minimum income specified	Existing customers only	Read our review
HSBC	18	£10,000 per year	New or existing customers	Check eligibility
Nationwide BS	18	£700 per month	Existing customers only	Read our review
Monzo Bank	18	No minimum income specified	Existing customers only	Read our review
Sainsbury's Bank	18	£7500 per year	New or existing customers	Read our review
Tesco Bank	18	No minimum income specified	New or existing customers	Read our review
Danske Bank	18	£16,000 per year	Existing customers only	Read our review
TSB	18	No minimum income specified	New or existing customers	Read our review
MBNA Limited	18	No minimum income specified	New or existing customers	Read our review
Abound	18	No minimum income specified	New or existing customers	Check eligibility
Lloyds Bank	18	No minimum income specified	Existing customers only	Read our review
First Direct	18	£10,000 per year	Existing customers only	Read our review
M&S Bank	18	£10,000 per year	New or existing customers	Check eligibility
Admiral	18	£19,000 per year	New or existing customers	Check eligibility
Novuna Personal Finance	21	No minimum income specified	New or existing customers	Check eligibility
Santander	21	No minimum income specified	New or existing customers	Check eligibility
Metro Bank	21	No minimum income specified	New or existing customers	Read our review
Bank of Ireland UK	21	£12,000 per year	New or existing customers	Read our review
Creation Financial Services	23	£9,600 per year	Existing customers only
Finio Loans	18	No minimum income specified	New or existing customers	Read our review
Progressive Money	18	No minimum income specified	Not specified	Read our review
Plend	21	No minimum income specified	Not specified	Read our review
Fluent Money	18	No minimum income specified	Not specified
Vanquis Bank	20	No minimum income specified	New or existing customers

What’s the minimum income I need to get a personal loan?

While your salary plays a part in your loan application, there is no minimum income requirement that will guarantee you will be approved for a loan. Conversely, there’s no guarantee that you’ll get a loan even if your income is well above the UK average.

When it comes to getting a personal loan, different lenders have different criteria that you’ll need to meet. Some lenders may have minimum income requirements, while other lenders may instead consider other aspects of your financial situation to see if you’re eligible for a loan.

What is the debt-to-income ratio?

The debt-to-income ratio (or loan-to-income ratio) is a simple measurement of your monthly debt compared to your gross monthly income. This lets lenders see how you’ve managed payments for what you’ve borrowed. Typically, borrowers that have a high debt-to-income ratio will likely have trouble making payments.

Borrowers with a debt-to-income ratio of over 40% are generally considered to be going through a financial hardship. By comparison, a debt-to-income ratio that’s about 20% or lower would be considered excellent.

Let’s say you have a total of £1,000 in bills each month and your gross monthly take home pay is £3,000 – your debt-to-income ratio is just over 30%. With a 30% debt-to-income ratio you would appear as a relatively responsible borrower.

How can I tell how much I can borrow?

The first step to determining your borrowing power is figuring out whether or not you can actually afford the loan. Work out your repayments based on the interest rate, fees, loan amount and loan term of your chosen personal loan.

After you’ve done this, determine whether you’ll be able to manage the repayments on your current budget. A good rule of thumb is that if you have a debt-to-income ratio of 40% or over, you should refrain from taking on any more debt.

How do lenders decide if I’m eligible?

When you submit an application for a loan, the lender will inquire about a number of details, they may include:

• Income
• Employment status
• Current debt
• Expenses
• Financial commitments
• Credit history
• Assets you can offer as security

What if I don’t meet the lender’s requirements?

There are a few things you can do if you find out you don’t meet the minimum income requirements:

• Apply for a lower amount. If you can’t prove to the lender that you’ll be able to manage repayments for the requested loan amount, consider borrowing less. This will mean lower repayments for you and less of a risk for the lender.
• Choose a more affordable loan. The reason you might be ineligible could be that the loan has fees and interest that the lender thinks is too expensive for you. Other loans may have lower interest rates and fewer fees, and in turn will give you a better chance of managing the repayments.
• Try your current bank. If you have a good banking history, you probably have a better chance of being approved for a loan with your current bank. You may be able to find product detail on your bank’s website.
• Find a guarantor. You may consider asking your parents, another relative or even an older close friend to be a guarantor for you. This person will be taking on a large responsibility because they are agreeing to take on the loan payments if you can no longer make them.

Loans for people with low income

If you don’t earn enough to be eligible for a personal loan, there are other options. The most common alternative would generally be a short-term or payday loan, which generally have lower requirements than regular personal loans.

However, short-term loans are also likely to be the most expensive form of borrowing, and should only be considered as a last resort.

Frequently asked questions

• Can I get a personal loan if I'm unemployed?

  It’s possible if you’re claiming benefits, in-between jobs or a pension. Most high street banks and building societies will simply decline to offer you credit if you are not in regular paid employment. However, you still have a few of options:

  • Secured loans. This would require you to put a possession up as security, such as a house or car. However, this security can be repossessed if you do not keep up with the payments.
  • High interest rate loans. The greater the risk you are to the lender, the more interest you’ll pay. It seems that people who need access to credit most face the highest interest rates from lenders.
  • Payday loans. These are short-term loans that come with exceptionally high interest rates and short repayment periods. It’s best to avoid payday loans as they are a slippery slope to being buried under a mountain of debt. It’s far better to avoid taking this route.

• Can I get a loan if I'm self-employed?

  You can, though it might be hard to qualify with some online lenders. Many use algorithm-based applications that sometimes don’t know how to recognise unusual proofs of income.

• What does borrowing power mean?

  Your borrowing power is a term that refers to how much money you’re able to borrow. People with lots of personal savings, high income and minimal debts have a greater borrowing power than those without.