Interest rates for personal unsecured loans of £5,000 now average 9.5 per cent, as rates surge due to the credit crisis. Although loans are available at rates as low as 6.7 per cent, some banks are charging nearly double this with rates of up to 13 per cent. Whilst most banks have tightened their credit standards, some have pulled out of the unsecured loans market completely.
However, interest rates do fall as the amount loaned increases. Personal unsecured loans of £7,500 have an average interest rate of just under 8 per cent, with rates available as low as 6.5 per cent, but range to over 11 per cent.
Given the tightening of credit standards in recent months, it is unsurprising that 1.91 million adults had unsecured personal loan applications rejected between April and October. Although that figure represents a significant increase on the 1.39 million from the previous six months, it is expected to rise further as the credit crisis continues to impact on both banks and homeowners .
Average Personal Loan Rate Now Nearly Ten Per Cent
Average Personal Loan Rate Now Nearly Ten Per Cent
Mon, 03 Dec 2007
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