Thrifty Loans

In the run up to Christmas the competition in the personal loans market has increased even more, with some lenders slashing their rates on personal loans, including Nationwide, which reduced its personal loan rate to the lowest in the UK at 6.2 percent recently. Whilst eligibility terms and conditions will apply for the loans, it adds additional pressure on other lenders to also look at cutting their rates, which means that the personal loans market will become far more competitive for consumers.

This will come as good news for those who are looking for low rate personal loans, particularly at this time of year when there is an increase in the number of people having to take out finance in order to fund the cost of Christmas and the New Year. Whilst personal loans, like other forms of finance, have become more difficult to obtain since the onset of the global financial crisis, those with good credit are still able to enjoy a decent choice of loans, with rates getting increasingly competitive.

Officials have said that the lower interest rates typically tend to affect mid-range loans of between £7500 to £15,000, which is where interest rates are most competitive. Loan rates are said to have been falling for some time and this move by Nationwide could mean further drops in rates across the board.

One finance expert said: “The £7,500 to £14,999 tier has been highly competitive since the start of the year. In January 2011 the lowest rate on a £7,500 loan was 7.4pc, today it is 6.3pc. Nationwide Building Society had been the equal market leader with Tesco Bank, Marks & Spencer Money and Sainsbury’s Finance, but this latest reduction moves it ahead of the competition.”

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