Compare low-interest personal loans

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

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Good and bad credit histories considered

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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.

Compare low-interest loans

Table: sorted by representative APR, promoted deals first
Name Product Ratings Customer rating Finder score Total Payable Monthly Repayment Representative APR Link
Bank of Scotland Existing Customer Personal Loan
Finder score
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Expert analysis
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.7% p.a. (fixed). Representative APR 6.7% and total payable Β£11,034.00 in monthly repayments of Β£306.50.
Novuna Personal Loan
Finder score
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User rating
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Expert analysis
Check eligibility
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 7.4% p.a. (fixed). Representative APR 7.4% and total payable Β£11,142.00 in monthly repayments of Β£309.50.
Barclays Existing Current Account Loan
Finder score
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.1% p.a. (fixed). Representative APR 6.1% and total payable Β£10,941.12 in monthly repayments of Β£303.92.
Ulster Bank Existing Customer Personal Loan
Finder score
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.6% p.a. (fixed). Representative APR 6.6% and total payable Β£11,018.52 in monthly repayments of Β£306.07.
AIB (NI) Personal Loan
Finder score
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Expert analysis
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 7.1% p.a. (fixed). Representative APR 7.1% and total payable Β£11,095.56 in monthly repayments of Β£308.21.
Halifax Personal Loan
Finder score
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.6% p.a. (fixed). Representative APR 6.6% and total payable Β£11,018.52 in monthly repayments of Β£306.07.
NatWest Existing Customer Personal Loan
Finder score
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User rating
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Expert analysis
Check eligibility
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.6% p.a. (fixed). Representative APR 6.6% and total payable Β£11,018.52 in monthly repayments of Β£306.07.
Virgin Money Existing Customer Personal Loan
Finder score
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Not yet rated
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Expert analysis
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Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.9% p.a. (fixed). Representative APR 6.9% and total payable Β£11,064.60 in monthly repayments of Β£307.35.
HSBC Personal Loan
Finder Award
HSBC Personal Loan
Finder score
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User rating
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Expert analysis
Check eligibility
View details
Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.9% p.a. (fixed). Representative APR 6.9% and total payable Β£11,064.60 in monthly repayments of Β£307.35.
Royal Bank of Scotland Existing Customer Personal Loan
Finder score
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Not yet rated
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Expert analysis
Check eligibility
View details
Representative example: Borrow Β£10,000.00 over 3 years at a rate of 6.6% p.a. (fixed). Representative APR 6.6% and total payable Β£11,018.52 in monthly repayments of Β£306.07.
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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 fluctuate, yet at the moment, an annual percentage rate (APR) below 10% for a loan would generally be deemed as a “low rate.” Essentially, this functions like any other personal loan, where you borrow money to cover expenses and repay it with 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 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 very few people 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 who 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 causes 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 a personal loan, the money is transferred into your bank account electronically. You then have to make repayments monthly 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 repay.
  • 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 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 2 to 7 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 7 to 10 business days.

Where can I find a low-interest personal loan?

In your search for low APR 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 a 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. By going for a low-interest personal loan with a repayment plan of a few years, you can end up saving a tidy sum in interest.
  • Easy process. Getting a personal loan has become easier with widespread Internet usage. Apply online using any internet-enabled device or through lenders’ mobile apps. Many lenders also allow completing the identification process online.
  • Repayment flexibility. Some lenders offer payment flexibility (weekly, fortnightly or monthly) and allow penalty-free early loan repayment.
  • 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

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you. Most of the data in Finder's comparison tables has the source: Moneyfacts Group PLC. In other cases, Finder has sourced data directly from providers.

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