5-year Loans
A 5-year loan could help pay for your wedding, go towards a home renovation project, or help buy a new car. Check the loans you’re eligible for with Asda Money without affecting your credit score.
Whether a new car, debt consolidation*, a dream wedding, or the holiday of a lifetime, a 5-year loan could help you get the funds you need.
Find the right loan for you with our panel of trusted UK lenders. Our lenders offer loans from £1,000 to £25,000 over one to seven years.
*Please remember that by consolidating existing borrowing, you may be extending the term of the debt and increasing the total amount you repay.’
How does a 5-year loan work?
With a 5-year personal loan, you borrow a set amount of money and pay it back every month over five years. The lender charges you interest on the amount you borrow, so you end up paying more back over the length of the loan. By spreading your borrowing over five years, it often makes it more manageable to pay back the money than a shorter-term loan.
At Asda Money, we work with a panel of carefully selected and trusted UK lenders to help find a 5-year loan that works for you.
We search our lender panel to find different offers to meet your requirements and borrowing needs. With one simple eligibility check, you’ll only see offers from the most suitable lenders on our marketplace. It’s then up to you to compare each offer and choose the one that best fits your circumstances. You’ll then go on to complete a full application with the lender.
How much will a 5-year loan cost?
The full cost of a 5-year loan depends on a range of factors.
When you take out a loan over five years, you’ll need to pay interest. The interest rate and APR are set by the lender. Once you apply for a 5-year personal loan, the lender will offer you an interest rate based on your financial history and credit rating. You’ll likely be offered a lower interest rate if you have a better borrowing history.
A 5-year loan will likely have a lower interest rate than a shorter-term loan. Also, by spreading your loan over a longer term, your monthly payments will be lower. Just remember with a longer loan you will end up paying more in interest over the term of the loan, so you’ll pay more back to the lender in total. Use our helpful loan calculator to get an idea of how much you could potentially pay each month over the term of your loan.
What can I use a 5-year loan for?
The reason for borrowing the money is up to you. Often people use 5-year loans to support significant life events, whether a wedding, home improvements, or a dream holiday. You may also consider a 5-year loan if you have existing debts and want to consolidate them into one monthly payment*.
*Please remember that by consolidating existing borrowing, you may be extending the term of the debt and increasing the total amount you repay.
Advantages of a 5-year loan
There are several advantages of borrowing with a 5-year loan, including:
- Lower interest rate: By taking out a 5-year loan, you will likely be offered lower interest rates than a shorter-term loan. Although the exact interest rate you’re offered will also depend on your financial history as well as the length of the loan.
- Smaller repayments: By spreading out the loan over a longer period, like five years, your monthly repayments may be smaller. Just remember, you will end up paying more in interest over a longer-term loan.
- Flexibility: Our lenders provide loans from £1,000 to £25,000. Borrowing over five years gives you the flexibility to make important financial decisions with repayment terms you’re able to afford.
Disadvantages of a 5-year loan
Before you apply for a 5-year loan, consider:
- There’s more to pay back: Even with a lower interest rate, a 5-year loan is likely to be more expensive over the full term of the loan compared to borrowing the same amount over a shorter period – say one or two years. This means that by choosing a longer loan, you’ll end up paying more interest in the long run.
- You’re in it for the long-term: By choosing a 5-year loan over a 1-year or 2-year loan for example, you’re committing yourself to meeting your monthly payments for a full five years. It may be affordable now, but what happens if you lose your job or your financial situation changes during that time? Remember, missing any payments on a loan can be damaging to your credit score.
Getting a 5-year loan with bad credit
If you’ve had money problems in the past, you may have a poor credit rating which can make borrowing more difficult. You may still be able to get a 5-year loan with bad credit, but often there will be a smaller pool of lenders willing to lend you the money. In most cases, this will be with higher interest rates too.
If you can get a 5-year loan with poor credit, it can help boost your credit score over time. By meeting your monthly repayments, you’re demonstrating responsible borrowing which can have a positive impact on your credit score.
Can I get a loan over a longer period?
Yes, at Asda Money the lenders on our panel provide personal loans up to seven years.
We’re here to help
At Asda Money, we can help you find the right loans for you from across our panel of lenders, whether you’re looking for a 5-year loan, a 7-year loan, or a 12-month loan. We can also help you understand how to better manage your finances with our Financial Support.
Why choose Asda Personal Loans?
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The Asda advantage
Known for putting value for money at the centre of everything we do
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One simple form…
Receive quotes from a trusted panel of lenders without harming your credit score
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A loan offer that’s right for you and your circumstances
Top Personal Loans FAQs:
- Why choose a Personal Loan through Asda?
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Customers could access great rates from carefully selected trusted lenders, so you can sit back and let us do the leg work. What’s more, when you search for a personal loan, you’ll only have a soft search on your credit history, which means you can check your eligibility without harming your credit score.
Once your loan is approved, you could receive your funds the same day.
- How does it work?
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Asda is in partnership with Aro which is a trading style of Aro Finance Limited, who are a leading credit broker to offer our customers a different solution to borrowing money and finding a loan. We work alongside Aro so we can provide our customers with the right offer from a panel of handpicked trusted lenders.
With one eligibility check, you can search a panel of carefully selected lenders and provide you with a loan tailored to your needs. Once you have been approved you will receive your funds which could be in your account as quickly as the same day.
So sit back, relax and let us do the hard work.
- Who are your lenders?
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We have carefully selected a number of trusted lenders to be on a panel. You can search the panel to provide you with the very best offer you are eligible for. Find out more about each of our lenders here.
If you have any questions on our lenders, please call our Customer Service Team on 0333 555 0560 and a colleague will be happy to help.
- What commission does ASDA Money receives in connection to an introduction to Aro?
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If you take out a product through Aro, Asda Money will receive a commission payment from Aro. The amount charged will be in connection with the specific product selected and so different amounts of commission are received. The amount will be either a fixed amount or a percentage of the amount you take out, yet it will not impact the amount you pay back.
Should you wish to find out more about the commission paid to Asda from our introduction to Aro, please get in touch by emailing: compliancehelpdesk@aro.co.uk
- How much can I borrow?
- Will applying affect my credit rating?
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No. One of the best things about our service is you get access to a panel of trusted lenders with no hard credit footprint left on your credit file. When you apply with us, a soft search is completed which doesn’t harm your credit score.
However, if you do proceed with an offer from your search with us, the lender will complete a hard search. This will show on your credit file.
- What credit score do I need for a bank loan?
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Strictly speaking, there is no minimum credit score for you to be approved for a personal loan. If you have a strong credit score, more lenders may be willing to lend to you with better interest rates on offer. If you have a lower credit score and have had problems borrowing in the past, you may find a smaller pool of lenders are willing to lend to you. You may even have to look for a specialist lender that offers loans for bad credit.
- Can I get a loan with a CCJ?
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If you have a county court judgement (CCJ) against your name, you may struggle to get a personal loan with mainstream lenders. However, you may find specialist lenders that are willing to lend to you.
- Can I borrow money with bad credit?
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If you have bad credit or have had money problems in the past, you may find that some lenders aren’t willing to lend to you. Those that are may only do so with higher interest rates. It’s worth looking at specialist lenders for bad credit loans. Or you can work on your credit score to improve it before applying for a loan.
- Why won’t my bank give me a personal loan?
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Lenders look at a variety of factors when deciding on whether or not to offer you a loan. They each have their own criteria which will take in your credit score, job, monthly income and more. If you have been rejected by a lender, you can always ask them why and hope they will give you some insight into their lending criteria. They may direct you to one of the main three credit bureaus to find out more information.
- Do personal loans look bad on credit?
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When you apply for a personal loan with a lender, this will show up on your credit file. Your credit score may take a very small hit in the short term once you take the loan out. But if you pay your monthly payments on time and in full, this can have a positive impact on your credit score.
- How to get the lowest rate for a personal loan?
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The interest rates offered by lenders depend on a range of factors including how much you’re borrowing and the length of the loan. They will also look at your credit score. To help get a lower rate, you can look to improve your credit score by signing up to the electoral register, closing old accounts, checking for any errors on your report, and paying all your bills on time. You may also consider increasing the length of the loan or borrowing less.
- Can I take out a loan if I already have one?
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Yes, you can. When you apply for a new personal loan, lenders will look at your existing borrowing to see if you can afford the second loan. Many people choose to take out a new loan to consolidate existing borrowing – whether loans or credit cards – into one loan with a single monthly repayment.
Please remember that by consolidating existing borrowing, you may be extending the term of the debt and increasing the total amount you repay.
About our trusted provider, Aro
Asda is in partnership with Aro which is a trading name of Aro Finance Limited. Both Asda Money and Aro are credit brokers, not lenders. We offer our customers a different solution to borrowing money and finding a loan.
We work alongside Aro so we can provide our customers with their very best loan offer from a panel of handpicked trusted lenders.
With one simple eligibility check, our panel of lenders can provide you with a loan tailored to your needs. It’s also a safe way to find a loan without negatively affecting your credit rating.
Other Links
ASDA Money is a trading name of Asda Financial Services Ltd who are an Introducer Appointed Representative of Aro which is a trading name of Aro Finance Limited (company number 06297533) of Dakota House, Concord Business Park, Wythenshawe Manchester M22 0RR. Aro acts as a credit broker and not as a lender and is authorised and regulated by the Financial Conduct Authority (FRN 662079).
Terms and conditions apply. UK residents aged 18 and over. If you take out a product through Aro, Asda Money will receive a commission payment from Aro. The amount charged will be in connection with the specific product selected and so different amounts of commission are received. The amount will be either a fixed amount or a percentage of the amount you take out, yet it will not impact the amount you pay back, for more information see our FAQs