Can you have Multiple Personal Loans?

It’s not hard for you to imagine. You take out a £10,000 personal loan, say, to help pay for your wedding. This was before you found your dream venue. You borrowed £5,000 to buy a second car – but then the first one stopped working. Hence you find yourself with multiple personal loans


A second personal loan can help when you have underestimated the total cost of an event, a major purchase or just about any other expense. But beware. It can work out more expensive and riskier than the first personal loan.

Can I take out two personal loans at the same time?

Yes, in theory, this is perfectly possible, provided the lender allows it. Ultimately, lenders want to lend. The more money they lend, the more money they make in interest. Naturally, they’ll want to take care not to expose themselves to undue risk. They also have a responsibility to ensure that they are lending responsibly.

In reality, each lender will have its own policy around additional borrowing for existing loan customers. For example:

  • Some lenders simply won’t allow multiple concurrent loans or “top-ups” to existing loans.
  • Many lenders insist that you terminate your first loan and take out a new larger loan.
  • Some lenders allow you to take out a second loan after the first loan has been maintained successfully for a specified period.
  • Many lenders are perfectly happy for you to run multiple loans concurrently.

Using Different Lenders

Alternatively, you have the option of applying for a different lender. However, bear in mind that they will take into account that you have already had a personal loan running with another lender. That could make you a higher risk, so you might get rejected or else a lender offers a rate higher than the advertised representative APR. Many applicants don’t realise that lenders are only obliged to award the representative APR to 51% of people who take out a personal loan. The other 49% could pay a higher rate of interest, depending on factors like credit score, risk profile and income/expenditure.

Consolidate your Debts?

Consolidating the debt could be another viable option, but perhaps you scored a fantastic rate on your first loan, and you don’t want to lose it, or perhaps you want to avoid being penalised for paying off your first loan early. A common early repayment policy among providers of personal loans is to charge two months additional interest on any amounts paid off early, so by moving the debt to a new loan, it is theoretically possible to find yourself doubling up on interest.