Compare loan deals
We’ve teamed up with Creditec
- Check your eligibility for a loan before you apply
- No effect to your credit score
- Representative 48.9% APR
- Simple to use
What is the best loan for £25,000?
Comparing a number of different loan deals is the best way to find the right personal loan for you. You can use the representative APR figure as an indication of which provider offers the cheapest deal, though it will not necessarily be the rate you get. Read our article ‘What is representative APR?’ for more information.
The advantage of comparing a range of lenders is that you can get a broad idea of what is available. For example, a lender could offer the best interest rate, but not the term length you need. An alternative option could have the perfect term length available, but not the full £25,000. Doing a comparison should mean you find a deal that covers as many bases as possible.
You will see in the table that some lenders offer an eligibility checker that you can use to see how likely you are to be successful before you apply. This can help you limit how many rejections appear on your credit file. This is useful because too many credit applications in a short period can suggest that you are not managing your finances well and make it harder to get credit in the future.
We have more information on the basics of a loan in our article ‘What is an unsecured loan?’.
What is the best loan for £25,000?
You can use Money to the Masses partner Creditec* to swiftly generate a list of loan options matched to your needs and circumstances. By simply adding in a few basic details, you will see a tailored collection of the best loans for you. You can use your Creditec results to learn how likely you are to be accepted for a certain loan, which loans available to you offer the best terms, what option will leave you with the lowest fees to pay and more. Creditec is able to do all this without running a full credit check, which means your credit score will not be affected. Click on this link to get started*. If you are not eligible for a loan with any of the providers on the panel then you may be shown a variety of alternative products that may be suitable for you. You are under no obligation to continue with them if you feel they are not suitable for your circumstances.
The best rates on a £25,000 loan – June 2026
| Loan provider | Representative APR (five-year term) | Available loan term | Monthly payment | Eligibility checker? |
| First Direct¹ | 5.7% | 1 - 8 years | £478.18 | No |
| M&S Bank | 5.9% | 1 - 7 years | £480.38 | Yes |
| TSB | 5.9% | 1 - 7 years | £480.38 | No |
| Tesco Bank | 6.0%² | 1 - 10 years | £481.47 | Yes |
| Santander | 6.4% | 1 - 5 years | £485.88 | Yes |
| Novuna Personal Finance | 6.7% | 1 - 7 years | £489.20 | No |
| AIB (NI) | 7.1% | 1 - 5 years | £494.61 | No |
| HSBC | 7.7% | 1 - 8 years | £500.25 | No |
Representative APR is based on a 5-year loan term
¹You must be an existing personal current account customer with First Direct
²Clubcard members receive a preferential rate, non-members will get from 6.4% with monthly payments from £485.87
Check your loan eligibility
We’ve teamed up with Creditec
- Check your eligibility for a loan before you apply
- No effect to your credit score
- Representative 48.9% APR
- Simple to use
How a £25,000 loan works
A £25,000 personal loan works like most other forms of borrowing – once you are approved, the lender will transfer you the money and you will need to start repaying what you owe. The repayments will usually be in equal monthly instalments over a pre-agreed period of time and include interest charges. You should have been informed what each monthly payment will during the application process. You may be able to pay more than the agreed amount to clear your debt more quickly, but some lenders will charge a fee. The loan fees you are expected to pay should be made clear by the lender.
A £25,000 personal loan is a form of unsecured borrowing, which means you will not need to use a valuable asset – such as your home – as security. If you want to learn more about the differences between secured and unsecured loans, read our article ‘Secured vs unsecured loans: Which is best for me?’.
An application for a £25k loan can be completed online, over the phone or at a high-street bank branch. You will usually need proof that you are a UK resident and over the age of 18.
Can I get a £25,000 loan with no credit check?
An affordability check and credit check are an essential part of a loan application in the UK. These can help the lender better understand whether you are able to afford the monthly repayments and ascertain how trustworthy a borrower you are. This means that some applicants will be rejected because there is too great a risk of repayments not being paid on time.
You can avoid being rejected by checking your eligibility online before you apply and keeping track of your credit score. We explain how to check your score in our article ‘The best way to check your credit score for free’. You can learn to improve it by reading ‘How to improve your credit score quickly’.
Even if you have a low credit score, it is still possible to get a loan. However, a bad credit loan will usually be more expensive than a standard loan. This is because the interest rate will often be higher and loan term longer. Read our article ‘How can I get a loan with poor credit?’ to learn more.
The key figures in a £25,000 loan
Here are the crucial numbers when you compare £25,000 loans:
- Loan amount - What you can borrow will depend on the affordability criteria of the lender, your financial circumstances and your borrowing history. You may not be able to borrow the full £25,000, or you may be able to borrow as much as £50,000 or more.
- Loan term - Many lenders will allow up to seven years to repay the loan, but some lenders will offer longer terms and others will limit the term depending on the amount borrowed.
- Loan fees - Fees will vary depending on the lender you choose. Make sure that you check your documents carefully to understand any fees that may apply.
- APR (annual percentage rate) - This is the annual rate that shows you the cost of borrowing the money in the first year. It takes into account the interest you are being charged as well as other applicable fees.
- Representative APR (annual percentage rate) -This is the APR that the lender expects at least 51% of successful applicants to be offered. While you may get a higher or lower figure, it can be a good way to compare providers.
- Early repayment charge -
- This is the percentage figure that a lender may charge if you decide to clear your debt before the end of the loan term. If you took out your loan after February 2011, there should be no charge for paying off up to £8,000. For overpayments greater than £8,000, lenders can charge up to 1% of the amount that was repaid early, or 0.5% if you are in the final year of the repayment period.
Your credit score is also important, as it is an assessment of how trustworthy a borrower you are. A low credit score will make rejection more likely, while a high score could mean you are offered the lender’s best rates.
How much will a £25,000 loan cost per month?
The cost of repaying your £25,000 loan will depend on the APR and the term of your loan. Stretching out the loan term will reduce the monthly payments, but it will make the overall cost greater. This is because there will be more time for the debt to grow with interest. Shortening the loan term will mean you pay less interest, but the monthly payments will go up. It is important to make sure you can afford to pay the monthly repayments in full and on time.
The table below shows how the length of the loan term affects the monthly payments and total cost of a £25,000 loan with an APR of 5.9%
| Term of loan | Monthly payments | Total cost |
| 1 year | £2,148.75 | £25,785.00 |
| 2 years | £1,105.16 | £26,523.84 |
| 3 years | £757.68 | £27,276.48 |
| 4 years | £584.22 | £28,042.56 |
| 5 years | £480.38 | £28,822.80 |
What can I use a £25,000 loan for?
Your lender will likely require you to state how you intend to spend the money as part of the loan application process. Common expenses will usually include:
- A wedding
- A car
- Home improvements
- Debt consolidation
- A holiday
What can't I use a £25,000 loan for?
While you are free to use a personal loan for almost any purpose, there are a few important exceptions. Most lenders will reject your application automatically if you intend to use the the money for:
- Gambling
- Illegal activity
- Buying shares
- A deposit for a property
Borrowing for business purposes may also be restricted by some lenders. We cover specialist business loans in our article ‘What is a business loan?’.
Pros and cons of a £25,000 loan
Take a look at these advantages and disadvantages of a personal loan to work out if it is the right option for you.
Pros of a £25,000 loan
- Spread the cost of a purchase
- Stability of fixed monthly repayments
- Widely available
- Borrow at a lower long-term interest rate than most credit cards
- Less direct risk to your assets compared to a secured loan
- Can be repaid early in most cases (though sometimes for a fee)
- Applications can be approved and money paid out relatively quickly
Cons of a £25,000 loan
- No interest-free period
- Can be difficult to borrow a small sum at an affordable rate
- Missing repayments or failed applications can damage your credit score
- Difficult to get the best interest rate with bad credit
Alternatives to a £25,000 loan
A £25,000 loan will not be the right option for everyone as there are a whole host of different ways to borrow money and spread the cost of expenses. Here are some alternatives to consider.
- Secured loan - Your home, car or another valuable asset will be used as security, but you may be able to access much higher loan amounts and lower interest rates. Read our article ‘What is a secured loan?’ to learn more or go to our 'The best secured loans' article for the top deals.
- Credit card - A credit card is a flexible way of borrowing money as you only pay back what you spend, unlike with a loan. You can also take advantage of limited-time 0% interest options, but you may find that your maximum spend is restricted by a low credit limit. Check out our article ‘Best credit cards in the UK’ for more information.
- Remortgaging - This involves increasing what you owe on your current mortgage to borrow more money. We go into more detail our article ‘Remortgage to release equity from your home’.
- Car finance - You may find that specialist car finance is a more simple option than a £25,000 loan. We weigh up the pros and cons in our article ‘Buying a car: what are the best finance options?’.
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