Loans 'have never been so cheap'

Tue, 15 May 2007

Despite recent interest rate rises, personal loans have "never been so cheap", according to a new report.

Research by moneysupermarket.com revealed that the margin between the current base rate of interest and loan rates means that borrowers are receiving better value than in previous years.

While the base rate is presently 5.5 per cent, the firm argues that the best loan rate available on the market is 5.9 per cent with Masterloan. This compares favourably with rates four years ago.

Tim Moss, head of loans at moneysupermarket.com, said: "Tracking loan rates from March 2003 to date, there is no direct correlation with the Bank of England base rate movement."

As the base rate has increased, often loan rates have been reduced – ensuring that borrowers are getting a "damned good deal".

In related news, the Post Office recently reported that many consumers were failing to take advantage of high rates by continuing to place their money in savings accounts which have not passed on the recent increases.


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