Due to rising default rates, it is harder to get cheap loans in the U.K. than it was a few years ago. Financial institutions offer the cheapest loan quotes to existing customers who have a very good or excellent credit history. The closer you match the credit profile of the perfect customer, the lower the cost of borrowing will be.
How to get approval for best deal loans
The way in which you have managed your credit obligations during the last six years not only affects the likelihood of you being accepted, it also influences the cost of borrowing. Most lenders use a personal pricing strategy which is based on your credit profile. Make sure that you are registered to vote because lenders use this information to verify that you live where you claim. Personal information
Your age affects the cost of borrowing because default rates are significantly higher among younger applicants. You may be able to borrow money when you are 18 years old, but costs start to come down once you reach 21 years old. You will also need to provide address information for the last three years, and homeowners are favoured over tenants. They are easier to trace. Affordability
You will need to either be in work or retired, and may have to meet a certain income requirement. Most lenders will ask you to provide a breakdown of your income and expenditure, so they can make sure that you can afford the repayments.
Who offers the U.K.'s cheapest bank loans?
Lowest loan rate in the U.K.
At 6.6% on loans of between £7,500 and £14,999, Nationwide currently offers the cheapest loan deals. If you borrow less than £7,500, more than £15,000 or wish to borrow over more than five years, the rate of interest will be slightly higher. It is also important to appreciate that, if you settle the debt early, you will pay an early redemption penalty which is equivalent to 30-days of interest. Other places to get cheap loans online
Other places to get cheap loan rates include the Alliance and Leicester (6.7%), Sainsbury's Finance (6.8%) and Marks and Spencers (6.9%). It is important to appreciate that rates are constantly changing, and it is not simply because the Bank of England has changed its base rate. Always use a loan comparison site to compare the market for the best deals.