With thousands of subprime mortgages in the USA failing, banks have learnt the lesson and not only have they tightened credit standards, but many lenders have also raise personal loan rates. This past week alone has seen nine major lenders increase charges, with rates jumping by up to 4% in some cases. Some of the new rates are made all the more remarkable when compared with the base rate of 5.75% - itself a six year high and unchanged since July despite calls for the Bank to reduce it yesterday.
Perhaps the worst offender is Bradford and Bingley, who have increased the rate for personal loans of between £5,000 and £7,450 by 3.2% to 9.9%, and loans of between £2,000 and £2,950 by 4% to 17.9%.
Other lenders have not been quite so gruelling, with Northern Rock increasing rates by 0.5%, and Halifax by between 0.1% and 0.2% depending on the amount owed.
Banks Raise Personal Loan Rates
Banks Raise Personal Loan Rates
Tue, 09 Oct 2007
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