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Read the full methodologyPlease note: You should always refer to your loan agreement for exact repayment amounts as they may vary from our results.
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As an apprentice, you may find you’re a bit strapped for cash. While an unsecured personal loan might be suitable if you’re looking to borrow as an apprentice, you might find it hard to be approved for a loan if you don’t have much employment history or are earning under a certain amount.
Thankfully, there are several other loan options for apprentices, especially if you can provide evidence that your role is eventually transitioning to a full-time, salaried position. Although it might be better to borrow money from friends or family, this might not always be possible, and it can result in relationship issues if things go wrong. For this reason, you might want to explore these alternatives:
These are credit cards aimed at people with a poor credit score or no credit history, and they can be easier to get accepted for. The credit limits are lower, and the interest rates are higher than with traditional cards, but they allow applicants to build their credit score with each timely repayment. This could help them get access to more credit in the future.
The government offers Advanced Learner Loans to help apprentices with the costs of learning at this level. Your eligibility for these loans isn’t based on your income, and there are no credit checks involved. Instead, eligibility is based on your age, training provider, nationality and residency status. You must be at least 19 years old on the first day of your course. These loans are a good first step for apprentices looking for financial assistance. The minimum amount you’ll get is £300, and this is paid directly to your college or training provider.
Guarantor loans are when a family member or close friend agrees to be a guarantor and steps in to pay the loan’s balance if the applicant cannot do so. If you have a guarantor to support your loan, lenders are more likely to offer you a loan as the risk is reduced. But it’s also a big responsibility for the guarantor.
If you need a loan to buy a car, try striking a deal with a dealership’s finance department. There are a number of different options to explore, but read the small print carefully to be sure you know what you’re signing up to. Some options require you to put down a deposit first.
These short-term loans are easy to be approved for, but the interest rates are astronomical. Consider these a last resort once all other avenues have been explored.
Payday and short-term instalment loans
You can use an apprentice loan to help pay your course fees, and depending on the type of loan you choose and how large your loan is, you might be able to use funds to cover some of your living costs, too.
It’s important to compare the loans on offer to find the most affordable deal for you. Check the APR (rate) on the loan and the term lengths available, and find a deal with the lowest rate that offers monthly repayments you can comfortably afford. The longer the loan’s term, the lower your monthly repayments, although you’ll pay extra in interest, so the overall cost of your loan will be higher.
Explore all the options listed above and calculate the total payable among the best lenders. This will often be displayed prominently online. Aim to keep your total repayable as low as possible while ensuring you can comfortably meet your monthly repayments.
Government-backed loans tend to be the most favourable for applicants, although this is not always the case. Bear in mind that lenders tend to offer better rates if you’re willing to provide a guarantor or some sort of collateral to protect them in the case of missed repayments.
This depends on the type of loan you’re applying for. But you’ll usually need to fill in an online form, providing some personal details such as your name, date of birth and address. You might also need to give your National Insurance number and provide details about your income, as well as state what you’re using the funds for.
On top of this, you could be asked to provide proof of identity, such as a passport or driving licence, and proof of address, such as a utility bill. However, many lenders now verify your identity and address electronically through a credit reference agency (CRA), so this again depends on the loan you’re applying for.
Your loan eligibility won’t necessarily be affected by the fact you’re an apprentice, but lenders do take into account your annual income, the reliability of your payments and your credit history.
If you can demonstrate a reliable annual income and a history of responsible borrowing, you may still be eligible for a traditional personal loan with a more favourable rate. If you can show evidence that your apprenticeship is likely to transition into full-time employment during the loan’s term, this could also support your application.
Discover the most reliable means for migrants and international students to borrow money in the UK
If you have just started a new job, you could still be accepted for a personal loan. See how lenders compare and give yourself the best possible chance of being accepted.
