Shop Around For The Best Personal Loan

Shop around for the​ best personal loan
Personal loans are one of​ many financial products where savings can be made by searching for the​ best deal .​
Best personal loan - rate
Loan rates can vary from 5.5% to​ over 20% .​
On a​ loan of​ £10,​000 over five years this makes a​ difference of​ over £50 on​ monthly repayments – over £3000 over the​ term.
This shows that you​ should not take out the​ first personal loan you​ see .​
However,​ not everyone will receive the​ attractive headline rate,​ so you​ should check the​ actual rate you​ are offered and whether this is​ still a​ good deal .​
The rate you​ are given can depend on​ your credit rating .​
This is​ a​ scoring system that lenders use to​ show how creditworthy people are.
Best personal loan – switching penalties
If you​ are switching from one loan to​ another,​ you​ should check whether you​ would have to​ pay an​ early settlement penalty,​ as​ this can wipeout any potential saving .​
This applies to​ fixed-sum loans taken on​ or​ after 31 May 2018 and that are regulated by the​ Consumer Credit Act 1974 .​
If the​ loan is​ paid off early,​ the​ lender may charge an​ interest penalty (subject to​ a​ set formula) of​ 30 days or​ one calendar month .​
This applies when the​ original loan term is​ more than one year and the​ advance is​ £25,​000 or​ less .​
For terms of​ one year or​ less,​ no redemption penalty is​ payable .​
This penalty is​ set out in​ the​ rules governing repaying loans early and is​ covered by the​ Consumer Credit (Early Settlement) Regulations 2004 .​
Loans taken out before this date may have higher penalties.
Best personal loan – Payment protection insurance
You should also carefully consider whether to​ take out payment protection insurance with your loan .​
This covers monthly loan repayments if​ you​ are unable to​ work due to​ accident,​ sickness or​ unemployment .​
This can significantly increase the​ monthly repayments on​ your loan .​
Insurance is​ always provided by the​ lender,​ but can also be obtained from a​ stand-alone broker .​
With a​ stand-alone provider you​ can be assured that the​ insurance has not been added to​ your loan and interest charged on​ the​ resulting balance,​ as​ happens with some lenders’ insurance .​
Prices on​ this insurance also vary greatly,​ so it​ is​ certainly worth doing some research first.
Shop Around For The Best Personal Loan Shop Around For The Best Personal Loan Reviewed by Henda Yesti on August 13, 2018 Rating: 5

No comments:

Powered by Blogger.