Points to consider before applying for a personal loan

Here are a few important points that all consumers should be aware of before applying for a personal loan.

Annual Percentage Rate / APR

When searching for cheap personal loans use our loan comparison table to find the lowest APR. This is a good indication of how much interest you will have to pay the lender. Lower interest rates mean cheaper borrowing.

Is there a loan arrangement fee?

Some lenders but not all will add a charge know as a loan arrangement fee to the cost of the loan for setting up the loan. Watch out for loan arrangement fees when reading the terms and conditions of the loan.

Early repayment fees

Most loan lenders will charge an early repayment fee to consumers that want to pay off the total loan amount in full. You will need to look at this on an individual basis and see whether the full repayment even with the early repayment fee can save you money or not.

Do you require payment protection insurance?

Payment protection insurance or otherwise known as PPI is sold with you loan. It would protect your loan repayments if you could no longer work due to unemployment, accident or illness. You don’t have to take out insurance, but it could give you peace of mind.

Payment holidays

If you are struggling to pay off the loan you could have a payment break or payment holiday. This is where you can skip a monthly loan payment with getting a penalty charge. Check the terms and conditions to see how many and how many months you can have on your loan if required.

Compare APR’s from leading loan lenders with our loans comparison table.