Understanding the finer details of each can help you find the right one for your needs.
If you need to cover a cost and don’t have time to save, a personal loan can help you access the money quickly. You borrow the money for a set amount of time, making regular repayments plus interest.
Personal loans are typically unsecured, which means you don’t need to put up any of your assets – such as your car or home – as a guarantee in case you can’t repay the loan.
Explore: Quick guide to personal loans
Personal loans can be useful if you need to borrow a large amount of money and want longer to pay it back. They also provide predictability, as you commit to repaying the same amount each month over an agreed timeframe.
You may also be able to borrow more with a personal loan than you could with a credit card and cover larger expenses over a longer period of time.
At the same time, if you're looking to cover your basic bills, a credit card can provide more flexibility – both how much you can borrow and how quickly you repay it – and may be better for short-term borrowing. Credit cards may also offer Buy-Now-Pay-Later offers, such as interest-free periods on purchases, and could be more suitable if you're able to pay your balance off in full.
Explore: Credit cards vs personal loans
An overdraft is a short-term borrowing option linked to a current account. It can be useful to cover unexpected costs. Banks usually put a limit on overdrafts and you may be charged interest for using one. The interest rate for using an overdraft may be higher than other ways of borrowing. Other fees and charges may also apply.
Explore: How overdrafts work
An Education Loan is a type of personal loan you can use for education fees – whether you’re paying for your child or planning to study yourself. Education fees for the year generally need to be paid up front, which is where this type of loan can be useful.
You’ll be able to repay an education loan in instalments over an agreed repayment period – usually between 12 and 48 months. Costs do vary between schools, so it’s best to do your research before applying for an education loan.
Depending on your rental contract, you may need to pay your yearly rent all at once or in quarterly instalments, as well as a deposit. A rent loan, which you pay back over a set amount of time, could help spread the cost.
With an HSBC Rent Loan, you can get an individual interest rate based on your lending profile and a quick decision on your application, letting you know if you’ve been successful.
If you’re looking to fix up your property, a Home Improvement Loan could come in handy. You may be able to borrow enough to cover all your costs or use a loan to supplement your savings.
You can only have one personal loan at a time but if you need to borrow more, you may be able to apply for a Top-Up loan. This allows you to increase the size of your existing personal loan.
A home loan, or mortgage, can help you buy your own home. Home loans are secured, which means they’re backed by an asset – the home itself. In other words, a lender may be able to repossess your property if you can’t keep up with repayments.
Secured loans are usually for larger amounts and come with a lower interest rate than unsecured loans. Lenders are willing to offer lower interest rates because they have the security of the asset to fall back on.
Explore: Home loan types
HSBC's Green Home Loan is specifically designed for certified sustainable homes. You may be eligible to take out an HSBC Green Home Loan if the property you’re wanting to buy is Platinum or Gold LEED certified.
Each type of loan will have specific terms and conditions, so it's important to consider these when looking for a loan to suit your circumstances.
Before applying for a loan, consider all the associated costs and make sure you’re confident you can keep up with repayments.
Take the time to find the right loan for your needs, and make sure you meet the eligibility criteria before applying.
