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Best loans for 2014: what to expect when you go for a loan

At the moment, the average APR rate for loans in the UK is difficult to determine because so many short term payday loans are being taken out with APR between 600% and 700%, but most loans for those with decent credit top out at 51%. The best loans for 2014 are currently coming in at around 4% APR but an APR of anything up to 17% is respectable if your credit rating's not at the highest level.

Secured loan rates

Even a secured loan takes into account your personal circumstances, how much you can afford to repay and your credit rating so homeowners with a poor credit rating may wish to speak to their bank or building society about re-mortgaging. You may be compromising a mortgage deal that you took out when credit was easier to come-by if you re-mortgage but it could be your best option.

Unsecured loan rates

You might expect unsecured loan rates to be a lot higher, but that’s not reflected in the market where you can get loans with APRs of between 4% and 5% as long as your credit rating’s good. If it’s not good, you’re putting yourself in the hands of bad creditor loan firms.

Bad credit loans

Somewhere between 15% and 16% APR is considered a good loan rate if your credit’s bad. If you’re in the worse group of borrowers, you’ll have to depend on payday loan firms whose rates run between 600% and 700% APR. For a short term fix that patches up a financial mess this sort of loan is ok, but if you find yourself in that position, the road back to a respectable credit score and the lower rates it rewards is a long and tough one.

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