The consequences of the credit crunch are well and truly visible on the high street now, with some of the most competitive loan offers being removed as a result of the crisis. Lenders initially raised their rates on their personal loan offers, with nine lenders increasing rates significantly in the immediate wake of the sub-prime crisis.
Lenders have since begun withdrawing some of their best offers, with Leeds Building Society the latest example. The Yorkshire-based firm had been the only lender left who was charging less than 10 per cent for loans of up to £2,000 in addition to reasonable payment protection insurance rates of £19 a month. However, the credit crunch has resulted in the lender being forced to withdraw the offer due to the spiralling cost of borrowing.
Insurance charges are becoming an increasingly common way for banks to inject hidden costs, with the monthly costs soon tallying up to becoming a significant extra in addition to the interest repayable on the loan.





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