Loan market hots up with launch of the lowest ever personal loan rate
Average personal loans rates on the top five personal loans at £7,500 has dropped to the lowest average rate on record, according to analysis by MoneySuperMarket.com, following the launch of the UK’s lowest ever rate of just 4.6 per cent APR. The loan, launched today by Santander, is available directly through Santander or through MoneySuperMarket where you can compare against other deals, and is not available on any other comparison websites. The loan is only available for 10 days.
The comparison site has found the average top 5 loan rate for borrowing £7,500 in November 2012 was 5.68 per cent costing £1,104 in interest over the five years of a loan. In comparison, at the average rate of 4.88 per cent, the interest charged over five years would be £891 meaning anyone who is looking to borrow now will be better off by £213 compared to the same time last year.
Kevin Mountford, head of banking at MoneySuperMarket, said: “This year has seen the rates on the top personal loans edge under the five per cent mark, but the move by Santander in launching the lowest ever personal loan rate at 4.6 per cent is great news for anyone who is looking to borrow. It also throws down the gauntlet to the competition to respond at a time when demand for loans is traditionally low. However, anyone thinking about borrowing in the New Year, either to fund a new purchase or consolidate existing debts may find it beneficial to borrow now as there is no guarantee this low rate will be available come January – the traditional period where demand for loans is higher.”
“Whilst, the decision to borrow should never be taken lightly; consumers who are in the market for a loan can take advantage of the cheaper borrowing. As well as the amount you are looking to borrow, the other key thing that affects the cost of a loan is your credit score. These low rates are only available to those with excellent credit histories. Those without excellent credit histories continue to be charged significantly higher rates of interest.”