AA - no longer an association
The AA was set up in 1905 by a group of motoring enthusiasts. It was taken over by Centrica in 1999 but in 2004, the AA left the Centrica Group in a buyout funded by two investment groups, CVC and Permira. So you can't be a member of the AA anymore because it's not an association but you can take advantage of the services it offers.

How the AA Loan works
Like a number of lenders, the AA operates a risk-based pricing policy on the AA Loan and the interest rates it charges range from 5.8% APR to 19.9% APR. You can borrow any loan amount from £3,000-£25,000 but the interest rate you may be offered may vary depending on your personal circumstances, the AA's credit assessment procedure and other related factors. For example, if you want to borrow less than £5,000, the cost of the loan rises to a typical 10.9% APR.

You can choose the length of time over which you repay your AA Loan in a range of 12 months to seven years.
It may help your cashflow in the short term to take advantage of the three-month repayment holiday that is also offered by AA Personal Loans and AA Car Loans at the start of the loan. However, do remember that any repayment holiday will mean that your debt is not being reduced and is still accruing interest for the period of the repayment holiday.

Once your loan application is approved, you could have a cheque in your hands from the AA within 24 hours, or so they claim. It might be handy but it's not particularly cheap - you need to opt for the AA's courier service and arrange the loan by 3pm. If you choose the optional courier service, an additional fee, which is currently £45, plus a £5 levy if you request a specific delivery time, will be payable one month before your first monthly repayment.

If you want to make sure you can repay your AA Loan you may take advantage of AA Creditcare which is the organisation's payment protection insurance, potentially covering your repayments for up to 12 months. AA Creditcare is available provided you are aged over 18 at the beginning of your loan and under the age of 65 at the repayment date of your loan. You must also be a UK resident, in employment or self-employed and paying the appropriate class of National Insurance contributions.

You can review loan products from more than 50 loan providers including AA loan on Moneyextra's Loans Comparison tool.

Do you need to borrow more?
The AA offers existing customers a top-up loan facility which offers you the opportunity of borrowing between £5,000-£25,000, on top of your existing AA Loan. The quoted typical 5.8% APR is in line with their existing personal loan rates. Other terms and conditions are also in line with the main loan products.

Is the AA Loan right for you?
The AA Loan could well be the right loan for your circumstances. Any body looking to fund the purchase of a vehicle would certainly do well to consider the advantages of the added free AA warranty. However, there are many loan products available and it is always in your interests to review what alternatives you have before making your choice.