The personal loan market is a competitive one. With banks and private lenders competing for the top spot, it can be difficult to decide which one has the best personal loan rates for you. Read on for some helpful hints and tips you can keep in your arsenal when searching for your loan.
What Is A Personal Loan?
A personal loan is a type of loan in which you borrow a lump sum and repay a fixed amount every month for the duration of the contract. Also known as an unsecured loan, you won’t need to secure any assets against it, such as your home, in order to take one out.
Because there is no collateral placed against it, lenders decide on your eligibility based on your creditworthiness. The best loan rates you can get with this type of credit depends entirely on your borrowing history and your income.
Best Loan Rate Approval
Your credit report will be checked by lenders to find out if you’ve borrowed in the past, how much that was and how good you were at paying it back. They’ll look for late payments, defaults and big red flags like County Court Judgements (CCJs). You’ll also have an affordability check, which will examine your debt-to-income ratio to make sure that you can still survive on the money you have once the amount of the repayment has been taken into account. For the best loan rates, you’ll ideally have very good borrowing history, a good income and no glaring issues on your public record.
Should I Consider A Loan?
In an ideal world, nobody should need to consider a loan, but in some circumstances, it might seem like the only necessary option. Personal loans can be used for a variety of options and, providing you find the best loan rates available to you, you can use it for almost anything. At Personal Loans Now, we want to ensure you’re making responsible financial decisions; never take out a loan unless you feel it’s absolutely essential.
With that said, there are many reasons why a consumer might look into personal loans:
If you’re in a fair amount of debt with credit cards and other unsecured loans with higher interest rates, you might look at considering a lender with the best loan rates to help you consolidate your debts. You could be paying less each month and you’ll only owe money to one lender, rather than several.
You can’t always predict when you’re going to run into a problem with your home. For example, your boiler might stop running three weeks before Christmas, or your oven might malfunction in the middle of the summer holidays when the kids are at home for six weeks. If you need a small amount of money to replace an item in your home you can’t live without, a personal loan might be a good option.
While we always recommend keeping a savings fund for life’s little emergencies, we know this isn’t always an easy option. If you need urgent medical attention or your car fails an MOT and you need it to travel to work, a personal loan might be the quickest, short-term solution.
How Do I Find The Best Loan Rates UK?
At Personal Loans Now, we’ve created Credit on Demand, an innovative new-generation service which blends lending and brokering. We are a direct lender and a premium broker service, so we’ll do our best to find you the best personal loan rates available to you. If we can’t fund you the loan ourselves, we’ll search the market for the best option available to you.
We’re a responsible lender, so we’ll always carry out credit and affordability checks. If you meet our criteria and we are able to fund you the money ourselves, you’ll receive an instant approval decision and will be funded the money the same day if you wish to proceed.
Of course, there may be a chance that we can’t give you a loan with the best loan rates UK lenders can offer. In this case, we’ll automatically send your application on to Monevo who will search the market on your behalf. It’s simple! Monevo is a powerful platform with access to more than 40 FCA authorised direct lenders, massively increasing your chances of approval.
There are also loan comparison sites online which are designed to help you find the best personal loan rates on the market, or you could visit your bank or financial advisor for personalised advice if you have more time.
Things To Remember When Searching For The Best Loan Rates UK
As with any financial commitment, there are risks when agreeing to a loan contract. If the best personal loan rates are something you’re after, your credit score will often have to be high. Personal loans have higher interest rates than some other forms of credit. Because of this, you may not get the interest rate advertised, especially if you’ve struggled in the past, so always ask for a quote before you apply. The interest rate is likely to reduce if you take out more money, and many banks won’t lend less than £1,000 or for a shorter time period than a year, so you might be tempted to borrow more than you need. Always only borrow as much as you absolutely need to and ensure you can comfortably pay the amount back each month.
Every personal loan has to have a 14-day cooling-off period. If you decide to cancel the loan for whatever reason, you have up to 30 days to repay any money you borrowed and can only be charged interest for the time frame in which you had those funds. You cannot be charged for any additional fees and these must be refunded to you.
Be sure to check out whether the loan is a fixed or variable interest rate, what the arrangement fees are and include these costs in your budgeting before you take out the loan.
Best Loan Rates From Personal Loans Now
With some of the best personal loans, rates can vary. We’re committed to making on-demand credit available to more people in the UK, so we’ll try our best to find the best loan rates available to you if you need us to. Apply today and see if we can help you.