How to choose the right personal loan 

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Personal Finance

Team MONEYME|28 January 2025| 4-minute read

If you’ve done even a quick Internet search for personal loans, you’ll know that there’s a range of providers offering loans with a variety of terms and conditions. 

So, how do you know which is right for you? 

It’s essential to do your research – but, for that, you need to know exactly what to look for in a lender.  

Here are some key points for your list.  

✅ What’s the comparison rate? 

When advertising a personal loan, a lender often emphasises the more attractive aspects of their offer – be that a low interest rate or a flexible repayment plan.  

However, it’s important to read the fine print. Sometimes, an offer that seems too good to be true comes with a catch (or two!).  

To get a clearer picture of the true cost of a personal loan, look at the comparison rate. This takes into account the interest rate, plus fees and charges, enabling you to make realistic comparisons between lenders. You can find out your personalised comparison rate with MONEYME without impacting your credit score. 

✅ What are the repayment terms (and are they flexible)?  

Before taking out a loan, it’s essential to check that you can comfortably afford the repayments.  

Firstly, go through your budget and work out what you can afford on a monthly basis, taking into account your current expenses plus a buffer. Second, check what the repayments will be on the loan. 

Choosing a loan with flexible repayment terms puts you in control. With MONEYME, you can choose the repayment term that suits you best, from 3 years to 7 years.  

The longer the loan term, the lower the monthly repayments will be, but the higher the interest costs overall (unless you pay off the loan early) – so pick what works best for you. 

✅ What are the fees and charges?  

Sometimes, a loan with a low interest rate comes with surprisingly high fees (once you add them up).  

For each lender, consider all fees – including, not only monthly account fees, but also other charges, such as establishment fees and early exit fees.  

You can usually find this information on the lender’s website. If they’re not clearly listed, it’s a good idea to ask for a breakdown before applying. 

At MONEYME, we make all our fees and charges really clear in our quotes. We’re all about transparency so you are comfortable and understand all the costs before you decide to continue. 

✅ What happens if you want to pay your loan off early? 

Repaying a personal loan can take several years. In that time, your financial circumstances might change. You might get an unexpected promotion (and higher pay cheque), or, if you run a business, sales might suddenly boom.  

A windfall could enable you to make extra repayments, or even repay your personal loan early—which could mean big savings on interest. However, many lenders might make this costly by charging you early exit fees designed to recoup the lost interest. 

Before signing up, find out whether your lender’s approach is flexible. MONEYME doesn’t charge any early exit fees. Instead, you can repay your loan as soon as you like without being penalised.  

✅ How long will it take to get the loan? 

Thanks to smart technology, there’s no need to spend hours filling out unnecessary paperwork or wait days for an outcome on your application. Unfortunately, this is often the case when you apply with traditional banks. 

If you want to get moving faster with your loan, you can choose a lender that offers a simple online application instead.  

With MONEYME, you can get a quote online in minutes here. If you want to proceed, you can submit your full application in just a few more clicks. Most of our loans are funded same-day, even on weekends. 

✅ What’s the lender’s reputation? 

When you’re considering a lender’s reputation, you should look for three qualities: the general approval of other customers, transparency in all processes and excellent customer service.  

It pays to research your lender thoroughly by reading trusted online reviews. Do previous clients seem happy with their experience? Were they clear about what was going on every step of the way? Were they able to contact the lender easily to ask questions and sort out issues?  

At MONEYME, we’re pretty proud to have thousands of 5-star reviews across the popular review platforms.  

As a Certified B Corporation, we also take our responsibility to our customers and the community very seriously. The certification means we’re evaluated and held accountable for our initiatives to create a positive impact on people and the planet. 

Deciding on the right lender 

Once you’ve worked your way through this checklist, you’ll be in a better position to choose the right lender.  

MONEYME offers personal loans with competitive interest rates, total transparency when it comes to fees and charges, and flexible repayment plans, so you can budget to suit your lifestyle.  

To learn how to get the best deal possible when you apply for any personal loan, download our free Personal Loan eBook. 

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