Unsecured Loan Rates Hit Nine Year High

Mon, 01 Feb 2010

New figures from Moneyfacts.co.uk have revealed that interest rates on personal loans are currently at a nine year high. Despite some analysts optimistically claiming that the UK is emerging from the recession, lenders continue to adopt a cautious approach, charging high interest rates on risky forms of credit such as unsecured loans . The high interest rates are particularly remarkable given the Bank of England have reduced to base rate to a record low level.

Michelle Slade from Moneyfacts pointed to the absence of the typical post-Christmas loan sales as an indication of the cautious approach from banks . With lenders only looking to lend to the safest of applications at present, some individuals are turning to loan sharks and payday loan lenders to meet repayments. Lenders are fearful that borrowers in such a predicament will prioritise other debts ahead of unsecured forms of credit.

The high interest rates on personal loans, credit cards and overdrafts make shopping around particularly crucial, according to Moneyfacts. They claim that there is a £1,055 difference between the cheapest and most expensive £5,000 personal loan . Borrowers are also being warned that they may be reducing their chances of being accepted by making multiple applications for loans .
add to favouritesnewsletterlink to this pagesend to friendpost comments

Link to this page

Copy and Paste the following HTML into your page.

 

 

Income Protection Insurance
Get an instant quote with the award winning company

Paying Too Much?

7 out of 10 people are paying too much for their mortgage. To find out if you're one of them click here or fill out a FREE no obligation enquiry form