£11,000 loan guide: How to borrow £11k today

You have a few options if you are looking to borrow £11k. Many lenders will be able to offer this amount, and you may have options available in both secured loans and unsecured personal loans.

Unsecured personal loans

Personal loans range from £500 to £35,000, with repayment terms usually ranging between one and seven years. Lenders will look at your credit history and current financial circumstances so that they know you are able to afford to make the repayments if you take out an £11,000 loan.

Benefits of a personal loan may include:

• Fixed monthly payments
• Overpayment or early repayment options
• Fast application and payout – some lenders may transfer funds the same day once approved
• No security required – they don’t require any assets or property tied to the loan
• Interest rates that may reduce at higher loan amounts

However, you should be aware that personal loans do sometimes have higher interest rates than other forms of borrowing. You cannot borrow as much as you could with a secured loan, and it is the lender’s choice whether to offer early repayment options.

Secured loans

Secured loans, also known as homeowner loans or second-charge mortgages, are loans that give reassurance to a lender by tying an asset to the loan as security. This is usually a property or home you own, hence the name “homeowner loans”.

Benefits of a secured loan may include:

• Lower interest rates than other forms of borrowing
• Longer repayment terms
• Higher loan amounts compared to a personal loan
• May be able to be taken out even with lower credit scores

Your home may be repossessed if you do not keep up with repayments on a mortgage or any other debt secured on it.

Secured loans are not without risk, and you should consider your choices carefully before taking one out. A lender may repossess the property as a last resort if you are unable to make repayments, in the same way that a mortgage provider could.

A low credit score may not necessarily stop you from taking out the loan you need, but it could restrict the options available to you. You may have a lower credit score due to challenges in the past with repayments, or you may not have borrowed before so lenders don’t have much information to assess. Either way, there may still be options for accessing the loan you want.

Some lenders may still be willing to offer you a £11,000 loan, but the rates and monthly repayments may be higher.

Your credit score will also influence the options available to you, as well as the rates, amounts and repayment terms on any options. You should therefore try to improve your credit score in any way that you can beforehand, to get the best options available to you.

You also may wish to consider a guarantor loan as an option. Guarantor loans allow someone with a higher credit score to be added to a guarantor loan to support you, and can reassure the lender by offering security. The guarantor you choose will need to pick up the repayments if you are unable to, so choose carefully and make sure you both understand what is required of you.

You may also be able to take out a secured £11k loan. A secured loan, homeowner loan or second-charge mortgage is a type of loan secured against an asset, usually your home.

• Can be a higher amount than other forms of borrowing
• May be more likely to be approved, as a lender will be more confident in lending to you
• May come with lower APR or longer repayment terms

Whilst secured loans do have some benefits, they are not without risk. The lender can, as a last resort repossess your property, just as your mortgage provider can, if you are unable to make your repayments to ensure they do not lose money.

Your home may be repossessed if you do not keep up with repayments on a mortgage or any other debt secured on it.

Yes, most lenders will allow you to apply online for a loan, you’ll just need to get any signed paperwork back to them if they need it. Even better, right here at Aro we can help you compare all your options to find the right one for you!

We use a quick soft credit check so that there’s no mark left on your credit score, and we can show you all your potential options from over 50 UK lenders in minutes.

Once you know which lender you’d like to move forward with, you can make your application. Keep in mind that whilst we only use a soft credit check, the lender may wish to carry out a full detailed check to be absolutely sure in the agreement before confirming rates and any fees.

Generally personal loans are faster to apply, complete and approve than secured loans. This means the lender could be transferring your personal loan funds in a few working days or sooner. Secured loans, if you choose this option, can take a few weeks to fully complete due to the extra paperwork required.

Ultimately this will depend on your finances. You need to think carefully about whether you will be able to afford the repayments asked of you throughout the entire repayment plan.

Consider making a budget to check what income you have available for repayments. Once you have paid for essentials each month such as food, mortgage, utilities etc, do you have sufficient funds to take on the loan? Could you make changes to improve your financial situation?

Whichever loan type you choose, loans can be used for almost any legal purpose. Common uses of loans include:

• Debt consolidation
• Weddings / celebrations
• Purchasing a new car
• Holidays
• Home renovations

£11,000 car loans

Rather than choosing car finance, some people choose to fund their new car purchase with a loan. This can be a preferrable option to finance if you wish to own the car immediately and not have to worry about balloon payments or handing the car back at the end of the contract. It’s worth checking all car finance options available to you before making a decision.

£11,000 home improvements loans

Room renovation planned? Upgrading your kitchen? Whatever the plan, an £11k home improvement loan could give you all the funds you need to bring your dream home to life.

£11,000 debt consolidation loans

Debt consolidation allows you to clear all outstanding balances of other credit, loans and overdrafts with one loan, leaving you only a single payment to make each month. This may be at a lower interest rate or over a longer repayment term than previous debts, but you would need to compare options to see if it is right for you.

By consolidating your debt, you could potentially extend the term of your debt and increase the total amount you repay.

Setting up a direct debit or other repayment plan is a wise choice when taking out a loan. Missing repayments can cause further fees and damage to your credit score, which could impact your future credit plans. This way, you won’t accidentally forget to make the repayment, and it will make it much easier to budget for as it is predictable and consistent.

Once you reach the end of the repayment plan and have settled the balance of the loan, the balance will be cleared and the account will be closed.

The options available to you for repayment plans will vary depending on your credit score, but you may also have freedom in choosing how long you want the repayment to take. It is worth considering that the longer you take to pay off a loan, the more interest you may end up paying.

Here is a general guide with an example APR to give you an idea.

Representative example from Aro’s whole lender panel:

36.8% APR Representative (fixed)

Representative example: 36.8% APR Representative based on a loan of £12,500 repayable over 48 months at an interest rate of 36.8% pa (fixed). Monthly repayment of £500.83. Total amount repayable is £24,039.67.