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5 Year Loans

5 year loans are loans paid off in monthly instalments over a set period. Borrowers may use this type of loan to fund large investments or consolidate debt.

Five-year personal loans give you the flexibility to choose how much you wish to borrow over a manageable timescale. This can be through a secured loan, borrowed against your assets; or an unsecured loan, offered based on your credit history. However, it’s important to be aware of the risks of borrowing before taking out a 5 year loan. Find out more below.
  • Five-year loans are repaid in monthly instalments

  • They can be taken out as either secured or unsecured loans

  • Borrow between £3,000 and £500,000

  • The accumulated interest paid will be higher than with short term loans

  • Failing to meet repayments will affect your credit score.

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Homeowner rates, from 2.9%

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What are 5 year loans?

A 5 year loan sets the repayment window from the start, so you have an end goal for paying off your loan. This means you can plan your finances more effectively.

How do 5 year loans work?

Before you decide on a plan, you’ll need to choose between a secured or unsecured loan. A secured loan uses your assets, such as your home, as security on which to make the repayments. However, this loan is usually offered at a lower interest rate than an unsecured loan, which could mean cheaper monthly instalments.

Unsecured loans are not backed by collateral, so a lender will use your credit report to decide whether or not to offer you a loan. This means your chances of being accepted for a 5 year unsecured personal loan could be affected if you have CCJs or bad credit.

Benefits of choosing a 5 year loan

A 5 year loan can make borrowing more affordable than short term loans, as the repayments will be spread out over a longer period. This usually means the repayments are offered with a lower APR.

With a 5 year loan, you’ll have an end goal of when your loan will be paid off from the offset, allowing you to plan future finances and manage your money more effectively.

Risks of choosing a 5 year loan

While a 5 year loan offers flexibility, it can also negatively affect your credit score if you find yourself unable to meet the monthly repayments. If you continue to miss these repayments, this could mean losing your home (for secured loans) or being taken to court by your lender.

Even with a lower rate, a 5 year commitment will typically prove noticeably more expensive than a shorter loan when taken as a whole by the end of the repayment period due to more interest being payable over a longer term.

Applying for a 5 year loan

A 5 year loan can help kick-start your next project, reach a milestone or simply help you manage your finances. However, before you apply for a 5 year loan, assess your finances to ensure you can comfortably meet monthly repayments.

It can also be worthwhile tidying up your credit report by correcting any errors or misinformation, to improve your chances of being approved for the loan terms you want.

What do I need to apply for a personal loan?

If you’ve decided on a 5 year loan, you can start your application online. Afterwards, we’ll be in touch to discuss the following details:

If you are looking to consolidate your debts, it can be helpful to have details of any existing loan repayments to hand to speed up the process.

Commonly asked questions about 5 year loans

Find out everything you need to know about choosing a 5 year loan in our Q&A.

Why choose a 5 year loan?

A 5 year loan is one of the most flexible loans on the market, and means you can borrow anything from £3,000 to £500,000, giving you the breathing space to make a big financial decision at terms you can afford.

How can I check my credit score?

You can check your credit score through one of the three main credit reference agencies:

These companies may offer a free outline of your score once a month, but you’ll have to pay to see a more in-depth report.

Will searching for a 5 year loan affect my credit score?

Many lenders carry out a soft search initially. This won’t affect your credit score, although it is worth checking this before applying as some lenders will carry out a hard search. Being accepted and meeting your repayments each month will increase your score over time.

How long does it take to be approved for a 5 year loan?

After filling in an online application, you will receive an instant decision in principle from a lender. However, it can take up to two weeks for your application to go through and the money to enter your account.

Can I apply for a 5 year loan with bad credit?

Yes. At Norton Finance, we consider all applications for our 5 year loans, regardless of whether you have bad credit. Unlike a bank, we have access to a wide number of lending products, giving you more choice and flexibility.

To understand your terms, use our 5 year loan calculator to see an estimated monthly repayment or get an instant quote from us.

Norton Finance loan details

We search over 600 plans to help you get approved for the loan you need.

How much can I borrow?

At Norton Finance, you can borrow anywhere from £3,000 to £500,000.

How long are the repayment terms?

Choose from one to 30-year loan terms for a flexible repayment plan that works for your circumstances.

What are the interest rates?

Your current circumstances as well as your financial history will affect the interest rates you are offered. Homeowner rates start from 2.9%.

Are there any loan fees?

At Norton Finance, we do things a little differently. Our lenders pay commission upon completion of the loan application. We charge a broker fee on some secured loans, up to 12.5% of the total amount, which is capped at £3,995. However, there are no broker fees on our unsecured loans.

Can I pay off a loan early?

Yes, most loans will allow you to repay the amount in full. However, be mindful that you may be faced with an Early Repayment Fee.

Can I get a 5 year loan?

We’re here to help you take control of your finances and secure the funds you need, regardless of your financial situation. To find out more about 5 year loans and how we can help, get in touch with one of our expert advisers on 0800 694 5566.

What can I use a 5 year loan for?

You can use a secured or unsecured 5 year loan for almost anything, whether it’s personal or business related. Here’s just a few examples:

Home

Improve your home

Borrow the funds to improve your home, whether you’re looking to increase its value or give yourself more space
Money

Consolidate your debt

Combine your loans and credit into one repayment plan and manage your finances more easily.
Building

Invest in your business

Start up a new enterprise or grow your business with a 5 year business loan.

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