A personal loan is an arrangement to borrow money over a fixed term. The term is agreed for you to pay the loan back in fixed monthly amounts, at a fixed rate of interest. At Halifax we offer personal loan repayment terms of between one and seven years. We work out the terms of the loan agreement based on a number of factors, such as the amount you ask to borrow and your monthly income and outgoings.

With a secured loan, the lender will ask for something such as your home as security, in case you can't pay the loan back. Personal loans are unsecured, so you're not asked to provide anything as security. Rates for unsecured personal loans are worked out on the amount of the loan, the length of the loan, and credit scores.

APR stands for annual percentage rate. You'll see it as a percentage.

It’s not just about the interest you’ll pay. APR factors in both interest and any fees that are automatically charged to your account. This gives you a good idea of the overall cost and is useful if you’re comparing loans or credit cards.

Representative example

You could borrow £10,000 over 48 months with 48 monthly repayments of £223.32. Total amount repayable will be £10,719.36. Representative 3.5% APR, Annual interest rate (fixed) 3.45%.

 This representative APR applies to loans of £7,500 to £25,000 over 1 to 5 years. Other terms and loan amounts are available at different rates. If you qualify for a loan we’ll tell you the rate that applies when you get your personalised quote. The maximum APR you could be offered is 29.9% APR.

There are many ways you can use a personal loan, however there are exceptions (please see below for a list of these).

We find that most customers borrow for things like home improvements, such as a new bathroom or kitchen, or a new car. You might need some extra cash to cover an unexpected emergency, like a broken boiler. You could even make your dream holiday a reality.

In some cases a personal loan can also be a good idea if you're looking to consolidate your existing debts into one easy-to-manage monthly payment.

Loans cannot be provided for:

• Buying property, such as land, house, council right to buy.
• Deposits on property.
• Deposits on timeshares.
• Gambling.
• Buying shares.
• Illegal purposes such as drug related activities.
• Business purposes.
• Paying back a loan arranged through the Student Loans Company.
• Paying back debt for someone else - for example, a husband paying back their wife's debt.
• Day to day living expenses or household bills.
• Paying off arrears such as late rent or council tax.

These limits apply whether you want to borrow money for yourself or to help support someone else. For example, you can't borrow to give a family member a property deposit.