| Why you should never take a loan from your bank
You can almost always borrow more money for less by shopping around online. Save yourself hundreds of pounds by not falling for the hype. Have you ever been tempted by the thought of borrowing thousands when your bank sends you a loan offer in the post? What about that moment when you ring up and they offer you an account review and you just know they actually mean to offer you a personal loan? Our advice is to steer well clear of most high street banks if you are looking for a loan. Most offer really poor value and you can do much better shopping around for cheaper credit. This is especially true if you are looking to borrow less than 7,500. Compare personal loan rates with our best buy tables High Street bank loan rates look good on paper The big banks are masters of the art of spin.
Get an unsecured loan?
Unsecured personal loans are granted on a mixture of factors, the most important are your income and employment status and your credit history. The interest rates available vary widely depending on how much you borrow and the time period over which you pay it back. Most advertised rates are typical rates and so, if you only wish to borrow small amounts, you will normally be charged a higher rate than that advertised. Unsecured loans are only available for sums of 25,000 or less. Click here for more on interest rates. To get the very cheapest unsecured loan rates you will need to have a good credit history. Click here to find out more about credit ratings. .
That slow killer in your wallet
Do your bit for society. Use plastic, reads a very cleverly worded advertisement of a credit card, where the card issuer promises to contribute a sum to a well-known charity, if you spend money through its cards.
The bank also makes it very convenient to pay off the money thus spent in easy installments by allowing you to pay only 5% of the total amount due.
The only fly in the ointment is the interest that the bank charges if you do not pay off the full amount on the due date. The average interest rate charged on the amount revolved (bankerspeak for the amount allowed to be rolled over and paid later) is around 34% per annum.
I am sure you have wondered why the average rate of interest on credit cards is around 34% per annum when the average rate on a home loan and personal loan is around 10% and 18%, respectively? There are several reasons for this.
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