£5,000 loans

Compare unsecured £5,000 loans and identify which personal loans you're likely to be eligible for with our handy search tool[1]

  • The tool shows your chances of being accepted without affecting your credit score
  • Find details on a variety of loans and and see which option suits you best

Wads of £10 notes

What types of loans are available?

Key points

  • A £5,000 loan can easily snowball into a sizeable debt if you fall behind with repayments
  • Loan applications can usually be made online, over the phone or in person at your local branch
  • A smart search with GoCompare before a loan comparison/application can help protect your credit score

Loans are available from a variety of sources in the UK. These range from big-name banks and building societies, to credit card providers and payday loan companies. Though extra caution should be applied to the latter.

There are a few popular lending options.

£5,000 car loans

Whether you're looking to buy a new car out of choice or need to replace one that's past its sell-by date, upgrading can be expensive. It can also be stressful if you need a replacement urgently but don’t have the money available.

A personal loan can be cheaper overall than the finance offered by a car dealer – depending on your credit rating, the interest rates can be lower. Plus, having the funds to pay for a car outright can also put you in a better position to haggle on price with a dealer.

But borrowing money to buy a car can get out of hand, if you let it. It's easy to borrow more than you need, or commit to a car where you may struggle with the upkeep once you drive it off the forecourt. After all, car insurance and general maintenance don't come cheap.

Think carefully about how much you need to borrow, and whether you can afford the repayments as well as the day-to-day car running costs.

£5,000 consolidation loans

Combining several loans into one can help you to organise your borrowing. Handling a single monthly payment means greater clarity and less confusion when it comes to managing repayments. Plus, consolidating debts can lower the rate of interest from another high-interest debt, for instance a high-interest credit card that’s exceeded its interest-free period.

If you're looking to combine your debts, bear in mind interest payable varies depending on the provider and the amount borrowed. A debt consolidation loan may have a higher rate of interest than your original loans.

Always check the smallprint and do your sums before you consolidate. If you’re going to do it, it needs to be affordable and manageable.

£5,000 home improvement loans

Home improvements are a common expense for homeowners across the nation. From a lick of paint to a brand new bathroom, household revamps come in many forms and range in cost.

While spending beyond your means can be reckless at times, the cheapest option may not be the most economical in the long term. Cheap labour and/or materials may require additional work later on and could cost more overall. If you're considering a home renovation that requires a hefty price tag, a £5,000 home improvement loan l is an option.

A sensible loan, coupled with a solid budget, can cover a home improvement project. However, even the most disciplined project can run over budget. A simple revamp can easily turn into a mounting debt, so be sure to approach with caution.

Applying for a £5,000 loan

With online applications the norm these days, applying for a loan can be quite straightforward. And the money could potentially be sitting in your account within hours of applying for the loan.

If you compare using our smart search, you'll see your chances of being accepted for particular loans, without it hurting your credit score.

If you're not a fan of internet banking, you can still apply for a £5,000 loan over the phone or in person at your local branch. It's still worth doing a smart search online first.

You’ll get a better idea of the lenders who might accept your application, the interest rate to expect and how much they’re likely to let you borrow. Whether that’s online, over the phone or in branch.

Applying for any credit and getting declined will leave a mark on your credit score making future applications much harder.

Can I top up my £5,000 loan?

If you find that your initial loan of £5,000 isn't enough, most lenders offer the option to top up your loan.

While loan top ups aren't uncommon, they vary in form. Depending on your provider and circumstances, this could be offered as an additional loan to the original, or as a new loan that covers the overall sum.

Some loans have early repayment charges, so factor these in when considering whether it's cost-effective to top up.

There are often limitations, too. For example, it's not unusual for there to be a cap on the total sum borrowed at one time. Some providers also limit the number of active loans you can have at once.

Top tips for getting the most out of your loan

If you're considering a £5,000 loan, don't borrow more than you can afford to repay. Late payments have fees attached and could see you fall even further behind. Missing or late payments will also go on your credit file.

The length of the loan can affect your monthly repayments. For instance, taking out a £5,000 loan over three years will attract higher monthly repayments than a five-year loan. But a longer loan will likely lead to more interest payable overall, so paying it off sooner rather than later could save you money.

Regardless of which loan you opt for, our smart search is a valuable tool worth using. This allows you to see which loans you could get the green light for. It can help protect your credit rating, because the smart search doesn't affect your credit score.

By Martyn Grant