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Where to look for the best personal loans in the UK

Personal loans are so dependent on your financial circumstances and your credit rating that there’s really no such thing as the best personal loan. You should also consider other forms of borrowing like overdrafts and credit cards, particularly if the loan amount you need is less than £1,000. But if you’re looking to refinance an existing loan, the best personal loans in the UK at the moment may not come close to your existing borrowing arrangement.
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Credit crunch

The credit crunch isn’t a term that people use much nowadays but it’s the reason why interest rates on borrowing are so high. You might be able to get a loan with around 4% APR but that’s not as common as it once was, and quite often lenders look for security when they drop the APR rate to less than 5%.

Banks

You’ve probably already checked out the interest rates at the major banks like NatWest, HSBC, Santander and Lloyds, but you should also look into smaller banks like Clydesdale Bank and Yorkshire Bank. If you’re pushed for time, a comparison site like money.co.uk will show you the latest deals and give you a chance to review them side-by-side with one another.

Lenders

Don’t just consider the major banks when thinking about a loan as supermarkets are also in on the act and they tend to offer competitive rates of interest. They’ll also tie you in with deals on ClubCard points or Nectar card points, so take a look at finance from Tesco Bank (tescobank com) and Sainsbury’s bank (sainsburysbank co uk).

Final word

Always bear in mind that the rates listed are typical APRs and don’t necessarily reflect the rate that you’ll be offered. Depending on how important the loan is to your financial wellbeing, you could work on your credit rating before going for a loan. There are a few simple tricks to follow that will help make you more attractive to lenders.

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