Emergency loans

Find out what loans you’re eligible for without impacting your credit score

Find a loan

Emergency loans

If you’re suddenly faced with an unexpected expense, like car repairs or a new boiler, you might want to consider taking out an emergency loan.

But even if you’re in a hurry and need money fast, it’s important to compare different loans to make sure you get the right funding for your needs.

Borrowing money should never be a rash decision – you need to consider your options carefully and make sure you’re able to afford to pay back the debt.

What is an emergency loan?

An emergency loan isn’t a specific type of loan – it’s a way of borrowing money to cover an urgent expense. When you see ‘emergency loans’ advertised, they are typically for unsecured personal loans.

How can you get an emergency loan?

There are a number of ways you could take out a loan in an emergency:

Personal loan - Personal loans are usually for a fixed amount over a fixed period. In most cases you can choose how long you want to pay back the loan; for example, two or five years. A fixed payment plan means you know exactly how much you’ll be paying back every month. An unsecured personal loan lets you borrow money, usually between £1,000 and £25,000, without having to put up an asset like your car or home as collateral.

Debt consolidation loan - If you’ve got existing debts plus an emergency payment to make, like your mortgage, you might want to consider a debt consolidation loan. You basically move your debt payments onto a single loan, then pay them in one convenient monthly payment. Just be aware that you’re still taking on a new debt and extending the length of your loan means you may pay more interest in the long run.

Bridging loan - A bridging loan is a short-term loan that can be used to ‘tide you over’ while you’re waiting for funds to arrive. They are often used for buying a house when you’re still waiting for the sale of your old property to go through.

A bridging loan is a secured loan which means you’ll need a high-value asset like your house or land to use as security against the money you borrow. It may seem like a short-term fix, but it’s risky. You could risk losing your home if you can’t make the repayments.

Please note that you can’t compare bridging loans with Compare the Market.

Emergency loans to avoid

Go online and you’ll find a whole heap of emergency loans advertising quick ways to borrow money, often without a credit check. If it sounds too good to be true, it usually is. Many so-called ‘emergency loans’ come with ridiculously high interest rates. They can also be risky.

Even if you need emergency funds, it’s probably best to avoid the following types of loan:

Payday loan – a high-cost, short-term loan that you’ll typically need to pay back within a month. Penalty fees can add up quickly, so if you can’t pay it off in time, you could end up in even more debt. Check out MoneyHelper (formerly called the Money Advice Service) for information and advice on payday loans.
Logbook loans - an expensive and risky loan that is secured against your car. The lender takes ownership of your vehicle until you’ve finished paying back the loan plus interest. If you can’t make the payments, you could lose your car.
Doorstep loan – also known as home credit or home collection loans, they typically charge the highest Annual Percentage Rate (APR). APR includes the amount of interest you’ll pay on top of the amount you’ve borrowed, plus any fees the lender charges, over a 12-month period. When you take out a doorstep loan, the lender comes to your home to collect the repayments.

Please note that you can’t compare payday, logbook or doorstep loans with Compare the Market.

If you do decide to take out these types of loan, make sure the lender is authorised by the Financial Conduct Authority. A money lender who isn’t authorised by the FCA is known as a loan shark. They are breaking the law and you should stay well away.

How long does it take to get an emergency loan?

If you have a good credit score, a personal loan could be one of the quickest ways to secure emergency funds. If your application’s approved, some lenders will transfer the money on the same day. Others may take a little longer, but usually no more than a couple of days.

How much can you borrow with an emergency loan?

Most banks and building societies offer personal loans from £1,000 up to £25,000.

Use our loan calculator to help you work out how much you could afford to borrow.

Can you get an emergency loan with bad credit?

Typically, the better your credit rating, the quicker and easier it will be to find a suitable loan. If you have bad credit, it can be trickier to borrow money in a hurry.

There are fewer options for bad credit loans, but you might want to consider a guarantor loan. You’ll need someone close to you, like a family member with a good credit rating, to act as your guarantor. This means that they will guarantee to pay off the loan if you can’t make the repayments. It gives lenders the added security that the loan will be paid off, so they’ll be more willing to lend you the money.

Just be aware that if you manage to get a personal loan with bad credit, you probably won’t be able to borrow as much and you’ll likely be charged a higher interest rate.

Use our eligibility checker to see what loans you might be accepted for and how much you could borrow. It’s a soft search, so it won’t affect your credit score.

See how much you could borrow

Advantages of an emergency loan

Quick access to the money you need – depending on the lender, the cash could be in your account within 24 hours.
With a fixed-term personal loan you’ll know exactly how much you need to pay back every month – which can help with budgeting.
If you’re confident you can make the repayments on time, it could help you through a short-term cash crisis.

Disadvantages of an emergency loan

Many personal loans are only offered to people with good credit ratings.
If your credit score is less than perfect, you may be charged a much higher interest rate.
Think carefully about rushing into a loan – you could end up in more debt.
If you secure a loan against an asset like your home or car, you could end up losing it if you can’t make the repayments.
There may be fees to pay like late payment fees or an early repayment charge.

What are the alternatives to an emergency loan?

If you need to borrow a small amount of money to see you through a cash crisis, there are other ways:

Family or friends – probably the quickest and easiest option, as long as it doesn’t cause any awkwardness or friction.
Overdraft – an approved overdraft with your bank is quick to set up and can be a useful financial safety net in the short term – just watch out for those fees if you go over your limit.
Credit card – if you need to pay for something in a hurry, a credit card lets you buy upfront, then pay later. Even better, a 0% purchase credit card lets you spread the cost over a set period without paying interest. Just make sure you pay back the full balance before the 0% period ends.
Government loan – if you claim benefits and need financial help in an emergency, you might be eligible for a Budgeting Loan or Advance.

Frequently asked questions

Does an emergency loan impact your credit score?

Applying for any type of credit will impact your credit score. This is because you’ll need to undergo a credit check which will be marked on your credit file.

If you use our eligibility checker, you can see which loans you might be eligible for before you apply. It’s a soft search and won’t impact your credit score.

See what loans you might be eligible for

Are interest rates on emergency loans higher?

The interest rate you’ll be offered depends on your credit rating. When you see a loan advertised, it will typically show a representative APR. This won’t necessarily be the APR you’re offered. Lenders only have to offer the advertised APR to 51% of their customers – usually the ones with the best credit ratings. If your credit score is less than perfect, you may get a higher interest rate.

How much will an emergency loan cost me?

The overall cost of your emergency loan will depend on:

the APR you’re given depending on your credit rating
how much you’re borrowing
the duration of your loan

What happens if I can’t repay my emergency loan?

If you miss a loan repayment, or are late paying, you’ll likely be charged a penalty. If you repeatedly miss repayments, your lender may require you to repay the loan in full. This could lead to repossession of property/belongings to repay the debt. It's also important to know that missed repayments could have a negative impact on your credit score.

If you’re struggling to pay back your loan, talk to your lender as soon as possible. They should offer help and support – for example, they may offer an affordable repayment plan.

If you’re worried about debt, MoneyHelper (previously Money Advice Service) offers helpful information and advice on mangaging your debts.

Where can I compare emergency loans?

Comparing loans with us is quick and easy. We’ll only show you the loans you’re likely to be accepted for, so you won’t waste precious time wading through unsuitable quotes.

FInd a loan

What do I need to get a loan?

When you apply for a loan, you’ll have to undergo a credit check. Most lenders will expect you to have a good credit score, but the exact criteria can vary between each one. Generally, you’ll also need to:

be 18 or over – in some cases it could be 21
be a UK resident
have a regular income
be on the electoral register
have an active bank account
be able to afford the repayments.

Compare the Market Limited acts as a credit broker, not a lender. To apply you must be a UK resident and aged 18 or over. Credit is subject to status and eligibility.

What our expert says...

Needing money in a hurry can put you in a vulnerable position. You may be tempted to take up an enticing offer you found online or opt for a payday loan to see you through until payday. Many of these types of loans are risky and incredibly expensive. Just be aware that a short-term cash crisis could turn into a long-term debt problem if you can’t afford to pay off your loan.

- The Editorial Team, Experts in personal finance, insurance and utilities