11 February 2016

Looking for a loan?

Over the last few years Nationwide's personal loan rates have dropped from 7.5% to 3.4% APR. New lending avenues such as peer-to-peer lending and new providers such as supermarkets getting in on the action, has meant providers have lowered rates.

But with so many options available, finding the right personal loan can seem like a daunting task. So what should you consider when looking for a loan?

Four things to consider when taking out a personal loan

1. What can you afford?
Working out how much you can afford to borrow over what period can be difficult. Increasing your monthly payments by just £20, for example, may significantly decrease your total repayment value. We’ve created a handy Personal Loans Calculator to see how much you could borrow and what your monthly repayments would be.

2. Flexibility
Many loan providers allow customers to make overpayments throughout the life of their loan, which can reduce the overall term and therefore the interest that they have to pay. However, if you want to completely pay the loan off earlier than planned it may incur an early repayment charge. So if you think this is something that you may wish to do in future, it’s wise to check with prospective providers.

3. Protect your credit rating
A provider may have the lowest rate on the market, but because APRs (annual percentage rates) are ‘representative’ only 51% of successful applicants have to actually receive those rates. In some cases, you won’t know the rate you will get until you have submitted an application, which could adversely affect your credit rating. But at Nationwide, we let you know the rate you’ll pay before we credit check you, by serving a no obligation quote.

4. Payment holidays
Payment holidays can seem like an attractive feature worth seeking out, as they can allow you to defer payments should you unexpectedly find yourself under financial pressure.

But they often mean that you pay more interest in the long-term and providers may have strict criteria that you must pass prior to being granted the payment holiday. If you experience any problems meeting your repayments, it's recommended you get in touch with your provider or alternatively, speak to the Citizen’s Advice Bureau.

Personal loans that reward loyalty

Our main current account customers will pay at least 1% APR less on the same loan than any of our other customers. Plus, with our Loyalty Price Promise, if they were to be offered a better like-for-like loan from another UK loan provider, then we’ll beat it by 0.5% APR. This offer applies to loans from £1,000 to £25,000 between 1 to 7 years and is only valid in branch or over the phone. You’ll be asked to provide a copy of the competing offer that’s less than 30 days old, so be sure to hold on to it. Terms and conditions apply.

“We want to give our main current account customers special features to show how much we value them and to say thank you for their loyalty,” says Helen Tate, Product Manager. “On a typical £10,000 loan with a 60 month term, the 1% APR feature could save them as much as £261.”

If you are a main current account customer with us, you won’t get a better personal loan rate anywhere else.

Representative example

3.4% APR Representative (fixed). Based on an assumed loan amount of £10,000 over 60 months at an interest rate of 3.4% p.a. (fixed). Monthly repayment £181.24. Total amount payable £10,874.40.

3.4% APR representative (fixed) applies to loans of £7,500 - £14,999 for 1 – 5 years.

All loans are subject to status and are available to UK residents aged 18 to 79 only. The interest rate offered will depend on the amount you wish to borrow and your individual circumstances. Nationwide Personal Loans cannot be used for business or investment purposes, bridging loans, mortgage deposits or speculative reasons. Nationwide subscribes to the Lending Code.

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Nationwide is not responsible for the content or availability of external websites. Nationwide does not make any recommendation or endorse any advertising, products, services or other content on such external websites. Views expressed on third party websites are those of the public and unless specifically stated, are not those of Nationwide.

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