Compare £10,000 loans
New kitchen, car or wedding? A £10,000 loan could help. It’s a big financial commitment, so be sure to find a deal to suit you with the lowest APR and affordable monthly repayments.
Is a £10,000 loan right for me?
If you’re planning a new kitchen, paying for a wedding or want to buy a new car, a £10,000 loan could help you to cover the cost.
However, £10,000 is a sizeable sum, and lenders will likely want you to have a good – perhaps even excellent – credit rating before considering your application.
You’ll also need to have a repayment plan in place and be comfortable that you can afford the monthly repayments.
How much would a £10,000 loan cost per month?
As £10,000 is a big sum to borrow, you risk building up a larger debt if you struggle to make repayments. That’s why it’s important to work out what you’ll need to repay each month as well as the overall cost of the loan.
As with all loans, the longer you stretch it out, the more manageable your monthly repayments will be. However, with the added interest, you’ll end up paying more in the long run.
Decide what suits your circumstances best: cheaper monthly repayments over a longer period, or higher repayments over a shorter timeframe that will cost you less overall.
Here’s an example to give you an idea of what it could cost for a £10,000 loan over three or five years**:
| Initial Loan | Time | APR | Monthly Repayments | Total Repayments |
|---|---|---|---|---|
| £10,000 | 3 years | 5% | £299.21 | £10,771.58 |
| £10,000 | 5 years | 5% | £188.20 | £11,292.24 |
**Calculations were made using Compare the Market’s Loan calculator. Figures are for illustrative purposes only, to give an idea of how much a £10,000 loan would cost based on an example interest rate.
Only borrow what you can afford to repay. If you take on more than you can manage, you risk ending up heavily in debt and unable to stay on top of your finances.
What types of £10,000 loans are available?
With different types of loan available, here’s how you could take out a £10,000 loan:
- Unsecured personal loan - Tends to be for a fixed amount and term, with fixed monthly payments, so you know exactly what you’re paying and for how long. You won’t need any assets as security, so this can be a good choice if you rent a property. However, as you’re not offering any security, interest rates may be higher than with a secured loan.
- Secured loan - Secured against an asset, such as your home. Lenders see secured loans as less of a risk, so they tend to offer lower interest rates than for unsecured loans.
- Homeowner loan - A type of secured loan, this involves borrowing a lump sum against your property, typically for larger amounts up to £100,000. Interest rates may vary, so it may be harder to budget each month. You’ll also need to be a homeowner or have a mortgage to take out this type of loan. If you fall behind on your repayments, you risk losing your home.
How long will a £10,000 loan take to pay back?
A personal loan can usually range from one to 10 years. You’ll be able to choose how long you want to take out the loan for when you apply.
The longer you take to pay back the loan, the lower your monthly repayments should be. But it also means you’ll be paying interest for longer, so the overall cost of your loan will be more than if you paid it off sooner.
Our handy £10,000 loan calculator gives you a rough idea of how much your monthly repayments will be, based on the interest rate and length of the loan.
You can play with the figures and adjust the interest rate and term length to see how it affects your monthly repayments and overall cost.
Can I get a £10,000 loan if I have bad credit?
While it’s not impossible to get a £10,000 loan with bad credit, your options may be limited. You might also find the interest rate you’re offered is less competitive. This is because lenders consider borrowers with poor (or no) credit history a higher risk.
If you have a bad credit rating, a secured loan (where you put up a valuable asset such as your car or home as security) could be an option to suit you. Lenders are more likely to lend you the money knowing they can recoup their losses if you fail to pay it back.
You could also consider taking out a guarantor loan. You’ll need to find someone with a good credit rating who will ‘guarantee’ to pay back the loan if you can’t make your payments – usually a parent, family member or close friend.
The simplest option might be to build up your credit score and put off applying for credit until it’s improved.
What our expert says...
“When comparing loans, be wary of the advertised interest rates. The representative annual percentage rates (APRs) shown by lenders can be eye-catching, but they only have to offer these to 51% of customers. This means applicants with less-than-perfect credit ratings may find the rate they’re offered is considerably higher.”
- Guy Anker, personal finance and insurance expert
What else should I look out for when applying for a £10,000 loan?
There are a few other things to weigh up before you apply for a loan:
- A loan application can affect your credit rating. Lenders will perform ‘hard checks’, especially if you’re applying for an unsecured loan. These will be logged on your credit report. Applying to lots of lenders or for credit too often will leave a trail on your credit report and damage your credit rating.
- Before you start applying, check your credit report to see if it’s in good shape. You can check your credit score by using a credit reference agency. You can check your score as often as you like without it affecting your credit rating.
- Not all lenders charge early repayment penalties. If there’s a chance you may be able to repay your loan early, check if this is a feature of the loans you’re looking at.
How can I compare loans?
You can use our simple and quick comparison service to compare £10,000 loans.
We’ll help you compare representative APRs, repayment amounts and other important information like potential early repayment penalties.
Using our price comparison service is an ideal way to compare loans and test your eligibility without it affecting your credit score.
Compare loansFrequently asked questions
Can I pay off my 10K loan early?
While all lenders will let you pay off your loan early, some may charge an early repayment charge (ERC). Under the Consumer Credit Regulations 2004, lenders can charge you up to two months’ interest for early settlement.
If you’re planning to take out a loan and think you’ll likely repay it early, check for the size of any ERC when comparing deals.
What happens if I miss a loan payment?
If you miss a loan repayment, your lender could charge a late fee and extra interest on the remainder of what you owe. It may also damage your credit score.
What if I’m struggling to pay back a loan?
If you’re struggling to make the monthly repayments, speak to your lender as soon as possible. They might give you extra time to repay, reduce the interest on missed payments or work out a more manageable payment plan.
If you’re having debt problems, you can find out what options are available on the GOV UK website. You can also get free debt advice from the Money Helper.
What happens if I’m rejected for a £10K loan?
If your application for a loan is rejected, it will likely have an impact on your credit score.
You should be careful about applying for credit multiple times within quick succession. This may signal to lenders that you're desperate and in financial trouble, which may make them more likely to reject you. This could lower your credit score even further.
Give yourself time to rebuild your credit rating. It will improve your chances of being accepted next time around.
Our eligibility checker can help you see which loans you’re likely to be accepted for before you actually apply. It’s a soft search that won’t affect your credit score in any way.
What does APR mean?
APR stands for annual percentage rate and shows the total cost of borrowing money over a year. APR doesn’t just include interest, but any fees automatically added to the loan, such as arrangement fees. Knowing what the APR is can help you compare personal loans.
What is a soft credit check?
A soft credit check allows a company to look at your credit score, without it showing up to other companies on your credit history. It won’t affect your credit score. Try our guide to soft credit searches as well as our free credit report tool.
