Everyone wants to find the best personal loans at the lowest price possible, but cheap loans are not ‘one size fits all’.
The cheapest loans are built around a set of criteria that will be different for everyone. Use our comparison tables to find a loan specialised to your needs.
We explain how to find the cheapest loan for you with the lowest interest rate and explain what you need to know before choosing one.
What are the best loans?
As you can compare the cost of the loan upfront, loans compete almost exclusively on price alone, so the best loans are usually just the cheapest loans with the best loan rates.
However, other things come into consideration to determine the best loans, such as how flexible a lender is, if you can enjoy any repayment holidays, customer service, how long the term is and how long your application will take.
How to find the best loan rates for cheap loans
Our personal loans comparison service can help you find the best loan rates available to you. To find a cheap loan, we will need to know:
- how much you want to borrow
- how long you need to repay the loan
From this information, our comparison service will find the cheapest personal loans for you.
When you are looking at your results you’ll want to find the low interest loans, these are the ones with the lowest annual percentage rate (APR) for the amount and repayment period you want.
The APR takes into account the cost of interest on the loan and any set up fees or charges.
Which cheap loans are best for me?
A loan is a big commitment, so when you are looking for the best loan deals, as well as the APR, there are a number of other things to think about:
- Can you afford the monthly repayments?
- Are your circumstances likely to change in the future in a way that could affect your repayments?
- Will the lender allow you to pay back your loan early if you want to?
- Is there an arrangement fee?
- Can you take a payment break or defer your loan payments if you need to?
Types of cheap loans – car loans, personal and secured loans in the UK
Broadly speaking there are three different types of loan you can apply for in the UK:
- Personal loans – unsecured loans, normally offered against your credit score
- Secured loans – loans which are typically secured against your home, these are more suitable for long term loans in the UK, with payment terms of up to 25 years
- Car loans – car loans in the UK can be secured against your vehicle, or simply a form of unsecured personal loan
Getting cheap loans online
It’s likely than many of the cheapest UK loans are not necessarily bank loans. Online loans have emerged as cheap loan competitor in the UK in the past 10 years, meaning many of the UK’s cheapest loans are to be found with online specialist companies, or even unorthodox lenders such as peer to peer loan companies.
Will my credit rating stop me getting the cheapest personal loan?
If you have had problems in the past, you may not be eligible for the cheapest loans as you will not meet the loan’s requirements.
Often the best loan deals are given to people with the best credit ratings – as a result the rate you’re offered may be higher than the advertised rate.
Sometimes the lender will try and offer an alternative loan with a higher interest rate.
The rate you’re offered will also vary depending on how much you borrow and how long you want to repay the loan over.
Make sure you do another comparison to see if you can find your cheap loan with another lender.
- Credit Unions Banks and payday lenders aren’t the only places you can get a loan
- Guaranteed No Credit Check Cards Some cards may not require a credit check
- How To Strengthen Your Credit Rating A good credit rating will determine whether you’re offered credit and at what rate