Personal loan rates on the increase

Thu, 13 Mar 2008

Interest rates on unsecured personal loans continue to increase, new research has shown.

According to Moneyfacts.co.uk, the average rate for personal loans of all amounts is now 4.6 per cent higher than in March of last year.

The firm adds that smaller personal loans have seen the biggest increases, with the highest rate now 27.9 per cent compared with 19.9 per cent 12 months ago.

Michelle Slade, analyst at Moneyfacts.co.uk, said: "Anyone looking to take out a loan in 2008 is going to find themselves faced with having to shell out more by way of monthly repayments than they would have done over the last couple of years."

She added that the ongoing credit crisis is responsible for lenders increasing the rates on personal loans .

On Monday, unbiased.co.uk revealed that personal loan debt in the UK increased to a total of £9.8 billion last year, from £2.6 billion in 2006.
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