Unsecured Personal Loans

What is an unsecured loan?

This type of loan is an agreement between the lender and a borrower that is not secured against property, which allows you to borrow from £3,000 to £25,000. It’s different to a secured loan, which you might take out against your property or car.

With unsecured borrowing, your chosen lender will approve the loan, which you pay back with interest over an agreed time period.

Unsecured borrowing can mean higher rates because the lender feels there is a higher risk without using property as a guarantee. However, it can be a useful and efficient option if you do not have property to secure your borrowing against, and can be quicker to arrange.

If you can’t keep up with repayments, the borrower can’t claim against your home or car. Instead, the lender could take you to court, where you may be liable to a County Court Judgement (CCJ) or debt collection. Before you borrow, you may want to plan out a monthly budget which includes your repayments to reduce the chances of this happening.

Advantages of unsecured borrowing

Some of the pros of unsecured borrowing include:

• Repayment is based on your credit history and rating, rather than any property you own.
• You’ll usually be offered a loan over a flexible period of time, frequently at a fixed rate, allowing you to plan your payments carefully and ensure you can afford to borrow.
• You can improve your credit score if you meet your repayments on time and in full. This improves your chances of getting better credit in the future.
• If you already have a good credit history, you may be offered a loan with a lower APR.

Disadvantages of unsecured borrowing

As with any loan, it’s important to assess the risks and financial commitments. These may include:

• If you have a low credit rating, the rates you’re offered could be higher for unsecured personal loans.
• Missing payments may result in additional fees and charges, which could negatively affect your credit score.
• Some lenders may charge a fee if you fully pay back the debt sooner than you’d agreed in the original terms. However, most lenders only charge up to two months interest on early settlement.

Before you apply

When thinking about applying to borrow, it’s always important to consider your personal situation.

Can I afford it?

You should assess your ability to make monthly repayments as well as the interest fees. This can help you avoid negatively affecting your credit score, and being open to debt collection and court action.

Am I eligible?

Lenders will consider a number of points when deciding on your loan application. Your eligibility for a loan depends on:

• Your credit score and credit history
• The amount you want to borrow and borrowing terms
• Your affordability of monthly repayments, based on your total income
• Other criteria determined by the lender.

Check your credit report

Lenders will use your credit report to determine your suitability for a loan. For this reason, it’s important to make sure your report is accurate. Any errors in the information you provide such as your address or income could affect the chances of your application’s success.

Read our guide to lending decisions to find out what else you can do to increase your chances.

Use our handy loan calculator at the top of this page to start a quote now.

Representative example

HOMEOWNER UNSECURED LOANS - Rates from 12.9% APR.

Representative example: if you borrow £12,000 over 4 years at a Representative APR of 15.4% APR (fixed) you would pay £330.33 per month.

The maximum APR is 99.1%.

What do I need to apply?

When applying for unsecured borrowing, you will need to provide the following:

• Personal financial details
• Employment status
• Details of your income

Once you’ve supplied these, we’ll be in touch to talk through the next steps.

Ahead of our introductory call, it can be helpful to have your financial records handy, such as bank statements, monthly income and mortgage or rent payments.

If you’re planning to use your loan for debt consolidation, you can help speed up the process by gathering the information you have about any other existing loans or credit cards, including repayment costs and loan periods.

Commonly asked questions

Here are a few of the questions our customers often ask about unsecured loans, so you can decide whether it’s for you.

Does unsecured borrowing negatively affect my credit rating?

No. In fact, a well-managed loan repayment plan can help you to improve your credit rating. By making regular payments and repaying the loan in full within the agreed time frame – or before - you’re demonstrating to future lenders that you’re a responsible borrower.

Stay on top of payments and the loan won’t negatively affect your credit rating.

What is a soft search?

A soft search lets a lender see your credit report without leaving any trace of their search on your public record – so you will be able to see it, but other lenders won’t.

On the other hand, hard searches are visible and may negatively affect your credit score if they lead to unsuccessful loan applications.

How many unsecured loans can I have?

There’s no official limit to how many unsecured personal loans you can have at one time. However, you should always make sure you can afford all the repayments and interest or any fees before taking out an additional loan.

If you have multiple loans, it’s also worth noting that lenders will be able to see this on your credit report and may opt not to lend you more money if the perceived risk is high.

What happens if I default?

If you default on a loan without collateral, the lender can add fees or penalties to the total amount owed and take legal action to recover their debt. Ultimately, the loan may be taken over by a collection agency, who will pursue you for the outstanding payments.

Unsecured loan details

Norton Finance can help find a loan that corresponds to your personal financial situation and your individual needs. Because we compare loans, rather than offering one product like a building society or bank, we can scour the full market and identify the right loan for you.

Our flexible loan options for unsecured borrowing let you borrow from £3,000 to £25,000, over any period between 1 and 30 years.

We’ll make an ‘in principle’ decision on your application within 24 hours of receiving it and can make a direct payment in around 14 days. Use our unsecured loan calculator on this page to find out how much and for how long you can afford to borrow, adjusting the sliders to meet your ideal terms.

At Norton Finance, we have access to over 600 loan products as well as flexible repayment plans.

• How much can I borrow?
  We help our customers borrow from £3,000 to £25,000 as an unsecured loan.
• How long are the repayment terms?
  Repayment terms range from one to seven years, allowing you to select the period that suits your circumstances.
• What are the interest rates?
  The interest rate you’re offered will depend on your credit history, your current income and other financial details.
• Are there any loan fees? At Norton Finance, we receive commission from the lender when a loan is completed. However, we don’t charge broker fees on unsecured loans.