Best Loan Rates for Personal Loans in UK

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Post Office

Post Office

Why we chose it

With a representative APR of 3.1%, Post personal loans of this size may not be the best in the market, but they are available to all applicants for loan terms ranging from one to seven years. years.

However, choosing the shortest loan term you can afford means paying less interest overall.

Post office representatives’ APRs actually drop to 2.9% on larger loans between £ 15,000 and £ 25,000, but that shouldn’t be a motivation to borrow more than you need.

There will be a charge if you want to prepay the loan at the Post Office (although regular and one-off overpayments will cost nothing).

Advantages and disadvantages

  • Even representing 3.1% APR applies to terms up to 7 years
  • Representative’s APR drops to 2.9% after £ 15,000 if you need to borrow more
  • Cheaper APRs available
  • £ 12 late fee

* Based on a settlement amount as defined in the Consumer Credit (Early Settlement) Regulations 2004. This states that if you have less than 12 months of your loan, providers can charge up to 28 days of interest. An additional 30 days of interest may be added if there is more than one year of the loan term remaining, bringing the total maximum penalty to 58 days of interest.

** Late or missed loan payments will negatively affect your credit score

Why a personal loan?

The best advertised APRs (Annual Percentage Rates) we found in our research * for personal loans between £ 7,500 and £ 15,000 start at just 2.8% – that’s historically low thanks to the current environment interest rates (although it’s important to note that this won’t necessarily be the rate you are offered when you come to apply – we’ll talk about that later.)

What else is there to know?

Once you’ve been approved, loan repayments tend to arrive in your designated account the next business day or even the same day if you have a checking account with the same bank, or if there are efficient processes in place.

Most providers have some kind of payment holiday offer every year – usually a month, but sometimes two. You will need to make a formal request and be eligible (eg you have tracked payments). Keep in mind that this is a separate aid from the Coronavirus Payment Leave Aid.

If you find that you can repay the loan in full up front, you are free to do so, but many of the best deals have prepayment charges ranging from one to two months of interest. However, paying too much, in the form of a lump sum or a little extra each month, tends to be free.

You can usually check each lender’s terms and conditions on their website (this might mean downloading a PDF). If you don’t see what you need, make a phone call and speak to a representative.

What to look for in the best personal loans?

If you need to get your hands on some cash at this stage of borrowing, what are the best personal loans available?

We’ve made it easy to compare the loans that might be the best fit for you, ranking the best providers based on the representative APR and the loan terms to which it will apply.

We’ve also taken into account prepayment charges, fees for late or missed payments (more details below), as well as any other factors that might differentiate a lender, even if it’s just a mustache of the next.

A few things to note before you get started, however:

  • Chances are, the APR you see advertised is not the one you are offered. These are “representative” RPAs, which means that they should only apply to 51% of successful applicants.
  • Top tier personal loans like these are reserved for applicants with good or excellent credit rating. Always use an eligibility checker before applying to see your chances of being accepted. This way, even if you are flagged with a red flag, your credit score remains intact.
  • While some lenders don’t charge a penalty fee if you miss a payment, there’s a good chance your credit score will be negatively affected, which could have far bigger implications than paying £ 12 or even £ 25. .

What methodology did we use?

To arrive at our star rating of the best loan providers for a loan of £ 7,500 to £ 15,000, we ranked the following criteria in order of importance:

  • Interest rate: as measured by a representative APR (these are fixed)
  • Term: the repayment terms available on the best representative APR listed
  • Flexibility: if the lender imposes a penalty for the full repayment of the loan before the agreed term
  • Costs: what late or late payment fees are charged, if any
  • Other factors: we took into account other differentiating factors such as generous payment holidays

(* Research undertaken on September 1, 2021)


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