What documents do you need to apply for a personal loan?

Find out what you need to provide for lenders to proceed with your application.

Whether you’re ready to submit your personal loan application or you’re still in the researching stage, it helps to know what you’ll need when you apply for a loan. While much of the process can be handled online, there are still some documents you may need to provide as part of your application.

Applying online

When you apply for a personal loan online most lenders now electronically verify your identity and address through a credit reference agency (CRA) like Experian or Equifax. In this case, you will need to answer some questions that only you would know the answer to, but you won’t have the hassle of having to dig out any ID. This type of identity verification is known as “knowledge-based authentication” and will not affect your credit rating.

Sometimes the CRA will not have enough information about you on file (or in the databases that it has access to) to be able to verify your identity with a satisfactory level of certainty.

When this happens you may be asked to provide a photo of yourself, plus a photo of the identification page of your passport. Again, the lender will use technology provided by a CRA to verify your identity using the photos you’ve provided. If the lender doesn’t offer this facility then you may be asked to take ID to a branch or to post a certified copy (a copy that is certified as authentic by a member of the bank’s staff or by a solicitor, accountant, GP etc.).

You should be wary of sending off originals of particularly important forms of ID, such as your passport or driver’s licence.

Applying in-branch

When you apply for a personal loan in a branch, the old fashioned rules apply – you’ll normally need to bring two forms of identification – one to prove your identity and one to prove your address (you can’t use the same document to prove both). Normally it’ll be your passport or driver’s licence, plus a utility bill or bank statement.

To prove your address

Each lender will list the specific documents it will accept, but you’ll normally be able to use one of the following:

  • Driver’s licence
  • Benefits entitlement letter
  • HMRC Tax Notification
  • Local authority tax bill for the current year
  • A recent utility bill
  • A recent bank, building society or UK credit union statement
  • A recent tenancy agreement issued by a solicitor, housing association or local council

To prove your identity

Each lender will list the specific documents it will accept, but you’ll normally be able to use one of the following:

  • Driver’s licence
  • Passport
  • Blue disabled drivers pass
  • UK Armed Forces ID Card
  • Biometric Residence Permit

How lenders can verify your income

Again, those all-seeing credit reference agencies can amazingly now verify your income, through something called your current account turnover. However in rare cases you may still be asked to supply the following:

  • Pay slips
  • Bank statements
  • If you’re self-employed, tax returns from the last two years or other documents proving income

Many lenders will ask for your employer’s name and contact details in the full application. Your employer won’t necessarily be contacted by the lender though. Your pay slips coupled with your current account turnover are usually enough to satisfy a lender’s employment verification.

If needed, the lender can get in touch with your employer to verify. This is more common with mortgages than personal loans.

What other financial information will be required?

Lenders may occasionally require further information regarding your income and outgoings, such as:

  • Any documents that can prove additional sources of income
  • An estimation of your current expenses

If you’re applying to a lender that you don’t currently have an account with, you may also need to jump through a few more hoops than if you were an existing customer. This is primarily due to anti-money laundering requirements and will vary by lender.

Documents you need for a car loan

There are generally no additional documents you’ll need to provide if you’re applying for a car loan. While the lender will normally want to know what the loan is for, if the loan is not secured on the vehicle, the lender will not require any details on it – such as registration, tax, insurance, VIN number etc.

Four quick tips to speed up the application process

  • Use the soft search facility. Most lenders offer you the chance to give a few details (your name, age and address details for the last three years) in order to find out if you would be likely to be offered a personal loan, and to see what rate you might get (not everybody gets the advertised representative APR). This is a great idea, and it won’t affect your credit rating.
  • Know what’s needed before you start. To get everything organised, check the full list of required documents before you start your online application. When you click through to the lender’s site it will usually be listed before you begin.
  • File your documents. It probably sounds obvious, but if you file your utility bills, pay slips, bank statements etc. somewhere sensible, then you’ll know where to find them. It’s sometimes a good idea to have an electronic copy of your important documents for other purposes as well. It provides easy access whenever you need to complete an online application and could serve as a backup in case you lose the original.
  • Start now, finish later. Take advantage of the “save and complete later” function offered on most online application forms if you don’t have everything to hand. You will be given login details to come back later.

By knowing exactly what documents you’ll need, completing your loan application can be quick and stress-free. Now you know what to expect, you can confidently compare a range of personal loans and apply today.

Bottom line

If you’re after a loan, you’ll need to share some personal information with the lender so that it can verify your identity and evaluate your credit history.

To save time during the application process, it’s worth finding out exactly which documents you may need to share so you’ll have them to hand when you do apply.

The documents may vary from lender to lender but before settling on a loan that appeals to you, shop around and compare your options.

Frequently asked questions

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Written by

Chris Lilly

Chris Lilly is Head of publishing at finder.com. He's a specialist in personal finance, from day-to-day banking to investing to borrowing, and is passionate about helping UK consumers make informed decisions about their money. In his spare time Chris likes forcing his kids to exercise more. See full profile

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