You are here: Home - Credit Cards & Loans -

Rates on personal loans increase by 1%

Written by:

Average rates on unsecured loans have increased by up to 1% in the past six months, despite the Bank of England cutting rates three times, according to price comparison site MoneyExpert.

Research from the website found that the average rate for a £5,000 loan is now 10.16% compared with 9.5% in November 2007. The average rate for a £7,500 loan has increased by 0.91% to 8.88%, compared with 7.97% in November 2007.

According to MoneyExpert, lenders are still offering deals for less than 7% but the rates on the most competitive deals have increased from 6.4% in November to around 6.9% now. Furthermore, around 1.38 million people have had a loan application turned down in the past six months as lenders have imposed tougher criteria when deciding who to lend to.

Sean Gardner, founder of MoneyExpert, said: “The Bank of England has a battle on its hands to restore confidence in the credit markets, when lenders react to three rate cuts amounting to 0.75%, by actually increasing rates. The unsecured loans market is almost mirroring the mortgage market where the issue is not so much rates but availability – whether or not lenders will let you have the cash.

“However it remains the case that creditworthy customers can still access competitive deals and borrowers should research the market carefully before making an application.”


Tag Box




Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Teens support ethical investments

Nearly a quarter of teenagers want their parents to invest in ethical companies, according to the UK Social Investment Forum...