Top up loan

The key information below will help you understand our loan products.

Please read this carefully and all of the other information we provide, so that you can decide whether this product is right for your needs and circumstances.

However, it doesn't contain all of the information about the credit agreement you enter into if you do proceed with an AA loan.

So if you want further information or have any questions then contact us – you can find our number below and in the documentation we give to you.

Deciding whether you should borrow money

Before you borrow any money, ask yourself if you need to spend the money, are there other ways to finance the purchase, and can you afford to pay back the loan.

If you don't really need to spend the money today, then you should consider saving some money each month rather than getting into debt.

But if you want to borrow money and pay back an amount every month, a personal loan is one option. If you have any questions, then do contact us.

What is a loan?

A loan is a legal agreement between a customer and a lender: the lender lends an agreed amount of money over a pre-agreed term to the customer at a specified interest rate or APR. The customer is bound by the Loan Agreement to repay the loan by making specified regular repayments to the lender.

AA loans are unsecured loans, which means they're not secured against any asset, such as your home.

How can I use the loan?

A personal loan provides you with a lump sum which can be used to spread the cost of more expensive items over a pre-agreed term, such as home improvements or buying a car.

It's not suitable to fund day-to-day expenditure, or as a deposit for other credit arrangements, such as the deposit for a house.

You can't use an AA personal loan to invest in or trade in cryptocurrencies or other high risk investments.

What is a debt consolidation loan?

If you've got lots of different debts and are struggling to keep up with repayments, you can merge these into one AA loan as a way of potentially lowering your monthly payments.

With a consolidation loan you borrow enough money to pay off all your current debts and thereby owe money to just one lender.

Be careful though, as a consolidation loan can lead to more debt. It only makes sense if you use it to cut your spending and get back on track. You must still keep up payments until the consolidation loan is repaid, and also pay off any fees or charges to your old lender(s).

Who can apply for a loan?

An AA loan may be suitable for anyone:

• age 21 or over
• with no county court judgments (CCJs) against them
• who has been a UK resident for at least 3 years
• who has a regular income above £12,000 a year
• who has a UK-based bank or building society account that can pay direct debits.

For a loan over £25,000, you'll need to meet the additional eligibility criteria.

AA loan features

• You may be able to borrow more than with a credit card.
• Your repayments will the same every month, making it easier to budget.
• You can decide how long to repay the loan – but remember, the length of the loan will affect the amount interest you're charged.
• You can consolidate several debts into one personal loan, potentially reducing your monthly repayment costs. Again be careful, as you could pay more charges or a higher interest rate, and if you extend the length of the loan you could pay more overall.

If you do decide you want to borrow money

Before you apply, it's important to work out how much you can afford to repay each month, as this will narrow down the best borrowing options for you.

So make sure you're realistic about how much you could pay if your mortgage or rent went up, if you had to spend more on utility bills, or if your pay was reduced.

You should also choose the right type of credit or loan for your situation, otherwise you could pay more than you need to. Shop around and compare deals, looking at:

• the interest rate (APR)
• the cost each month
• how much you will repay in total
• penalties for missed or late payments

How is the decision made to lend money?

Before accepting you for a loan, information from credit reference agencies is used to assess whether you can afford to repay the loan.

Credit reference agencies collect information about your financial dealings, including borrowings and missed payments, as well as county court judgments (CCJs) where applicable. In this way they build up a financial picture of you, and this is then shared with banks and building societies – with your permission – to help them decide whether to lend to you.

Once you’re 18 or over, you can request your own credit report from any of the three credit reference agencies for a small charge.

Each time you apply for credit, a footprint is created on your credit file. While credit application footprints are not in themselves negative, if you collect a lot of them over a short period it can be a cause for concern. This is because a rush of credit applications close together can be a sign of fraud, or indicate that you are experiencing financial difficulties. Therefore, if possible space out your applications.

If you're simply shopping around for the best deal, don't submit a full application until you've made up your mind which deal is best for you.

When deciding whether to lend you money, fraud prevention agencies are also consulted to ensure the person making the application is you, and not someone else.

Any information you provide is used to decide whether to lend. This is in addition to information already held about you; information from enquiries made about you; and information we get from your dealings with us or our Group.

AA loans – things to keep in mind

Personal loans may have higher interest rates than some other forms of borrowing, particularly for small amounts, such as £1,000.

Alternatively, the interest rate can be lower for larger amounts, so you could be tempted to take out a bigger loan than you need, but try to avoid this.

And always read the Loan Agreement carefully before you sign it. If you don't understand any part of it, then call us on 0345 266 0124.

Making your loan payments

The repayment of your personal loan is by monthly by Direct Debit from your current account, or an account that accepts Direct Debits. The amount and the number of repayments will be set out in your Loan Agreement.

Before signing the Loan Agreement, make sure you can make the monthly repayments, and that you'll have enough money in your account to do so.

What interest rate will I be charged?

The interest rate you're offered will be a personalised rate based on your current individual circumstances, including: credit information about you held by the credit reference agencies; the loan amount you borrow; and th length of time you borrow for.

The interest rate and the repayments will be on your Loan Agreement form, and you must read this carefully before deciding whether to accept the terms of the Loan Agreement.

How much will I have to pay back?

Your Loan Agreement will state the number of monthly repayments and the total amount. The monthly date of your repayments will be in your welcome letter.

Early repayment of the loan

You can repay all or part of the credit borrowed at any time, as outlined in the Loan Agreement. It's called an Early Settlement and this may incur a charge of up to 58 days' interest.

If you want to arrange an Early Settlement, call us on 0345 266 0124.

If it's a partial repayment, we'll reduce the term of your Loan Agreement unless you request otherwise.

What happens if I miss a loan repayment?

If you don't make a monthly payment when it's due, it can affect your credit rating and make future credit more expensive or difficult to obtain.

Failing to make repayments will mean that you have broken the terms of the Loan Agreement, and could result in legal action against you. This may include us obtaining a charging order against a property you own, and you having to pay additional costs.

Full details of the consequence of missing a repayment are outlined in the Loan Agreement.

What are the fees and charges

Any fees and charges applicable to your personal loan are set out in the pre-contract information and the Loan Agreement form.

Make sure you read all the information carefully, and if you are unsure about anything, do call us before you sign the form.

If I change my mind, what is the AA loan cooling-off period?

You will have a 14-day cooling-off period, during which time you can cancel your Loan Agreement. This will start from the date you sign your Loan Agreement or when you receive a copy of the agreement, whichever is later.

If you do cancel, you have up to 30 days to repay the capital and interest.

Contact us if you have any questions

You can call us on 0345 266 0124 8am to 8pm, Monday to Saturday; 9am to 5pm, Sunday. We're closed on bank holidays.

About AA loans

What's an APR?

APR stands for Annual Percentage Rate (APR) and is used to show what the overall cost of the money borrowed is for a year. It takes into account the annual interest rate, how frequently it is charged (daily, weekly, monthly or annually), any fees charged when setting up a loan and any other applicable costs.

The APR makes it easy to compare different loan products across the market. 

What's a representative APR?

Where a representative APR is displayed it is the rate we reasonably expect at least 51% of successful applicants to get or lower.

What's a representative example?

This uses the representative APR to show what a typical loan would cost and provides information such as whether the rate is fixed or variable, how much the monthly repayments would be and the total amount  payable.

What's an illustrative APR?

Where an illustrative APR is displayed, it's the lowest rate available for the selected loan amount. All quotations given are for illustrative purposes only, giving an indication of how much the loan would cost over the term and what the monthly repayments would be based on this rate.

Will I receive the illustrative APR?

The APR you receive may vary from the illustrative rate.

The rate you're offered will be a personalised rate based on your current individual circumstances, including credit information held about you by credit reference agencies, the loan amount you borrow and length of time you borrow for.

Applying for an AA loan

How do I apply for a loan?

You can apply online and will get an instant decision in most cases.

To be eligible to apply you must:

• Have been a UK resident for at least 3 years
• Be over 21, and no older than 70 when the loan term ends
• Be employed with a salary of £12,000 or over
• Not have a history of county court judgments or bankruptcy
• Have a UK-based bank or building society account that can pay direct debits

For a loan over £25,000, you'll need to meet the additional eligibility criteria.

How much can I borrow?

From £1,000 to £40,000 in £100 increments. Loans over £25,000 are only available to new customers.

How long can I take a loan for?

Loans are available between 1 and 7 years, depending on the value of your loan.

Can you tell me how much a loan will cost without having to provide personal details?

We offer a personalised price which is based on your individual circumstances and the amount you wish to borrow, therefore it's necessary to capture your personal details.

If you do proceed and submit an application, a credit search will be registered at the credit reference agencies.

Can I use a loan to pay off debts?

Yes, in the right circumstances debt consolidation can be beneficial. If you have all your debts in one place, you only have to track one interest rate and make one payment each month.

However, before applying you should review your options to make sure that the loan is right for you. For instance, compare the rates of interest between your current loan or credit card providers and your proposed AA loan and consider how long the loans are for. You also cannot take out a loan with us over £25,000 to use for debt consolidation.

In some circumstances taking out a loan to manage your finances could mean you end up paying a higher rate of interest or it may take longer to pay the money back.

I'm not sure if an AA loan is right for me, what do I do?

Take time to consider carefully all of the information you're given so that you're sure the product is right for you.

The section Borrowing with an AA Loan on this page has more information, or you could discuss the loan with a family member or friend.

If you're still unsure about an application or what will happen next, call us on 0345 266 0124.

Should I take out an unsecured loan over £25,000?

Before you apply for a higher value unsecured loan with us, it's important to consider whether this option best suits your borrowing needs.

There are other financing products available across the marketplace.

For impartial advice about personal loans, visit the MoneyHelper website.

Can I change my mind about taking out a loan?

Yes. You have 14 calendar days from the day after you receive your acceptance letter to withdraw from your agreement.

If you decide you don't want a loan from us, just call 0345 266 0124 within this 14-day period.

Or you can write to AA Loans, PO Box 248, Sheffield S98 1QF.

When will I know if I've been accepted for the loan?

In most cases you'll get an instant decision online. In some cases we may require additional information or documentation. If this is the case we'll be in touch with you by post within 5 days.

What can I do if my loan application is declined and I don't agree?

If you're unhappy with the decision, you can ask us to reconsider by calling 0345 266 0124.

Or you can write to AA Loans, PO Box 248, Sheffield S98 1QF.

You should be aware that we can't guarantee that our original decision will be changed. To support your appeal you'll need to provide any additional relevant information which wasn't given to us when you first made your application.

What is credit scoring and how does it work?

All AA loan applications go through a standard credit scoring system, which works by taking all of your personal information and giving each relevant detail a score. These individual values are then added together to provide a final score which provides the basis for our decision.

This system helps us decide whether we can lend you money and is used by most other banks. The section Our decisions explained on this page has more information.

How do I get a copy of my credit report?

From Experian:
• Online at experian.co.uk
• By writing to Experian Ltd, Consumer Help Service, PO Box 8000, Nottingham NG80 7WE

From Callcredit:
• Online at callcredit.co.uk
• By writing to Callcredit, One Park Lane, Leeds, West Yorkshire LS3 1EP

These agencies will charge you for this service.

What happens after my application has been approved?

We'll send your agreement by post. You'll need to check all the details, sign the agreement and return it to us by post in order for us to transfer the funds to your account.

You'll also be sent a copy of our Terms and Conditions, Pre Contractual Information (SECCI), and Important Information about your loan.

It's important that you read and understand the information in these documents. Please contact us if there is anything that you don't understand.

How soon will I get the money?

We aim for the money to be in your bank or building society within 2 working days once we've received your signed agreement.

Loan repayments

When do I make my first loan repayment?

Your first loan repayment will be one calendar month from the date the loan is released to you.

You'll find the date on your welcome letter. If this day falls on a bank holiday or weekend, the repayment will be made on the next business day.

Can I change the date my repayments are made?

Yes. To change your repayment date simply call us on 0345 266 0124 and tell us which day of the month is best for you.

Repayment date changes are limited to one each calendar year.

How do I make my monthly loan repayments?

We require you to make your monthly repayments by Direct Debit, unless we agree otherwise. Your Direct Debit will be set up from the bank or building society you chose during your application.

If you want to change the account from which your repayments are paid, call us on 0345 266 0124.

What if I can't make my monthly repayment?

If you're struggling to keep up with the repayments on your loan for whatever reason, we're here to help. It's important that you call us to talk through the options available.

If you're in arrears and can't make your contractual payments, please call:

0800 032 8180

Lines are open Monday to Friday 8am to 8pm, Saturday 9am to 1:30pm.

Alternatively, there are various organisations that can provide confidential, impartial and free help and advice. The section Help and guidance on this page has mor information.

If you're already in touch with an organisation that's giving you financial advice, please let us know and we can deal with them directly.

What if a change in my circumstances impacts my ability to repay the loan?

If you become aware that your circumstances could change and may impact your ability to pay your loan, then call us on 0345 266 0124 to discuss the options available.

Can I take a payment break?

No, an AA loan doesn't come with a payment break option.

If you're struggling to keep up with the repayments on your loan, we're here to help. Call us on 0345 266 0124.

Alternatively, there are various organisations that can provide confidential, impartial and free help and advice. The section Help and guidance on this page has mor information.

What should I do if my personal details change?

If you need to update your personal details, call us on 0345 266 0124.

Can I pay my loan off early?

You can settle your agreement early – in full or in part – at any time. It's known as an Early Settlement, and you can download more information here.

If you want a full Early Settlement to pay off your loan you'll need to request a settlement quotation by calling us on 0345 266 0124, or writing to AA Loans, PO Box 248, Sheffield S98 1QF.

To make a partial Early Settlement you can call us to make a debit card payment. As a result of any repayment we reduce the term of your agreement unless you request otherwise.

If you do want an Early Settlement, this may incur a charge of up to 58 days' interest.

How do I find out my outstanding loan balance?

To get the outstanding balance of your loan account call us on 0345 266 0124.

What format can I receive my loan documentation in?

We can provide documentation in braille, large print or audio on request. If you require documentation in any of these formats call us on 0345 266 0124.

Or you can write to AA Loans, PO Box 248, Sheffield S98 1QF.

Existing customers

Can I borrow more money and add it to my loan?

Unfortunately, we can't add additional funds to an existing loan. If you want to borrow more money you'll have to settle your existing loan and reapply for additional borrowing, known as a top up loan.

You can't apply for a top-up loan that will bring your total borrowing with us over £25,000.

If you need more help call us on 0345 266 0124.

Can I change my mind if I take out a top up loan?

You have a 14-day cooling off period from the date you sign your AA Top Up Loan Agreement or when you receive a copy of the agreement, whichever is later. During the cooling-off period you can cancel your loan.

If you do change your mind and decide to cancel, you have up to 30 days to repay the the capital and interest of your new top up loan. Your previous loan can't be reinstated.

Contact us

How can I contact you about my application or loan?

You can find contact details on our existing customers page.

To help determine whether to provide you with credit and to ensure responsible lending, your personal circumstances are taken into account. To do this each application is assessed using a system called credit scoring.

How credit scoring works for loan applications

Credit scoring is used by most major financial organisations in the UK to help them decide whether to offer credit to a customer.

All AA loan applications go through a standard credit scoring process, which makes a decision based on a combination of the information you've provided, the loan provider's lending criteria and information obtained from both credit reference and fraud prevention agencies.

Credit scoring works by taking all of this information and giving each relevant detail a value (or 'score'). When all the individual values have been added together a final score for your application is produced. If this score reaches a certain level, set internally by the loan provider, then an application for credit will usually be accepted. If your score does not reach this level, then an application for credit may be declined.

Why credit scoring is used

Credit scoring is an automated process that allows each application to be assessed in an impartial and consistent manner, ensuring that all customers are treated fairly. It also helps a financial organisation to meet their legal and regulatory commitments as a responsible lender.

Every application for credit includes a certain level of risk, no matter how reliable and responsible a customer is. Credit scoring allows financial organisations to understand the level of potential risk for each individual applicant, and if the risk is too high then an application will not be accepted.

Why your loan application may be turned down

If your application is turned down it simply means that, based on the information available:

• Your overall credit score was not high enough to pass the required threshold, or
• There may be information held at the credit reference or fraud prevention agencies which has been interpreted as negative, or
• Your application may not have met one or rmore of the specific application requirements. For example, you will not be provided with credit if your annual income (excluding unemployment benefits) is less than £12,000.

Appealing a decision

If your application is declined, you have the right to appeal the decision, although there is no guarantee that the outcome will change. You can request an appeal by calling Customer Services on 0345 266 0124 or by writing to us at the address below. You will generally be asked to provide additional relevant information to support your appeal, such as copies of bank statements.

What you can do next

Loan applications can be declined regardless of what information is held by the credit reference and fraud prevention agencies, and if you are unsuccessful in applying for an AA loan it does not mean that you will be refused credit elsewhere as financial institutions make their decisions in different ways.

It is advisable to obtain a copy of your credit file before making any further applications (a fee may be charged for this service). The credit reference agencies used for your AA loan application were, Experian Ltd and Callcredit Check, and their contact details are below.

CIFAS – the UK's fraud prevention service – was used as the fraud prevention agency for your application, and their contact details are also below.

Contact us

AA Loans
PO Box 248
Sheffield S98 1QF

Contact Experian

Experian Ltd
PO Box 8000
Nottingham NG80 7WE

www.experian.co.uk

Contact CIFAS

6th Floor Lynton House
7-12 Tavistock Square
London WC1H 9LT

www.cifas.org.uk

Contact Callcredit Check

Callcredit Check
One Park Lane
Leeds LS3 1EP

www.callcredit.co.uk

Your proposed AA Loan Agreement is regulated by the Financial Services and Markets Act 2000 and by the Consumer Credit Act 1974 (the Acts).

The Acts give you certain rights and protections. We're obliged to give you an adequate explanation of your proposed agreement, and enough information so that you can make an informed choice about whether to go ahead with it.

Pre-contract information

In addition to the information contained on this page, you'll be provided with separate pre-contract information about your proposed Loan Agreement. This includes how you can withdraw from it once the agreement is made.

It's important that you read through the pre-contract information carefully.

What you can use your loan for

A fixed-rate personal loan provides you with a lump sum which can be used to spread the cost of more expensive items over a pre-agreed term, such as home improvements or a new car.

It should be used for mid- to longer term borrowing needs, and isn't suitable for funding day-to-day expenditure or as a deposit for other credit arrangements.

Making loan repayments

Under the terms of the Loan Agreement you have to repay the loan plus interest by making regular repayments to us.

The repayment amounts are calculated to make sure that by the end of Loan Agreement term the outstanding balance of the loan is reduced to zero – provided that you keep up your repayments.

The total amount that you pay depends on the amount of the loan, the applicable rate of interest, and the length of time you choose to pay off the loan.

Your pre-contract information and the Loan Agreement will explain the amounts, due dates and duration of your repayments; the interest rate payable; and the total amount payable by you.

So check these documents carefully to make sure that you can afford the repayments and that the loan is suitable for you.

Missing your loan repayments

If you don't make your repayments in the correct amounts and on the due dates under your Loan Agreement then you could face serious consequences.

There is a default charge of £12 for each missed or unpaid repayment. We'll also charge you interest at the interest rate shown in the Loan Agreement on any overdue amounts.

We may send you a notice about these charges. This means that the amount outstanding under the Loan Agreement will continue to grow, because interest amounts and default charges will be added to the outstanding balance.

We'll also send you a default notice asking you to pay by a certain date. If you don't we can:

1. demand immediate payment in full of the outstanding balance under your Loan Agreement
2. terminate the Loan Agreement
3. enforce any security which we may hold for your obligations to us under the Loan Agreement

If necessary, we can take legal proceedings against you to recover unpaid amounts under the Loan Agreement.

We would also seek to get our legal and other costs from you. This could result in county court judgments being registered against you, and a charging order (or an inhibition order in Scotland) being placed over a property which you own as security for the monies which you may owe us.

We could also report your default to credit reference agencies. Your default would be recorded on your credit reference file, which could be viewed by other lenders and agency users who search your credit reference file. This may make it difficult for you to obtain credit in the future.

Your right to withdraw

You have 14 calendar days from the day after you receive your acceptance letter to withdraw from your Loan Agreement. If you want to do so, you can notify us in writing or by calling us.

You'll have to repay any amounts outstanding and any interest due within 30 days. Once you have settled the amounts outstanding, the Loan Agreement will come to an end.

Any questions about your loan

If for any reason you don't fully understand the Loan Agreement, take time to consider your application carefully or discuss it with a family member or friend before committing.

If you have any further questions about the AA loan, please call us on 0345 266 0124 or refer to the FAQs on this page.

Are you worried about being pressured into taking out a loan, due either to fraud or financial abuse?

Fraud scams can include people asking you to take out loans for investment opportunities or on their behalf.

Help is available on the Take Five website where the government and UK Finance have advice on how to protect yourself from fraud.

Or if you're being pressured into taking out a loan through coercion, manipulation or any form of abuse, MoneyHelper has impartial advice for you.

Remember, only apply for a loan for your own use.

You're liable for any loan taken out in your name, even if you transfer the money to another person.

Please read these terms and conditions carefully and download for your reference.

• Terms and conditions for AA Loans