Your Guide to Finding a Low Cost Loan
Low cost loans come in many different shapes and sizes. When you consider a low
cost loan, you might only look at the Annual Percentage Rate charged, but you
should also be aware of the other ways in which lenders products can benefit
their customers. The key to finding a low cost loan is shopping around and
understanding the market. Click here for our free Guide to loans to help find
the perfect low cost loan.
Low Interest Rates
The most obvious way to choose a low cost loan is by looking at the rate
charged, known as the Annual Percentage Rate [APR]. On the whole, choosing a
low APR is the easiest way to save money on your repayments. But how do you
know you're making the right choice? New loans are introduced all the time and
lenders are always changing their rates, so the only way to tell which low cost
loan is the best is to compare them all, including the key terms and features
of the product.
Fixed and Variable Interest Rates
If you're looking for a low cost loan, you should ensure that your interest
payments remain low by choosing a fixed rate loan. Since a rock-bottom APR is
unlikely to get much lower, you will insure your payments against any changes
in interest rate so that you can budget accurately each month.
Loan Fees
Some lenders charge a loan arrangement fee when you take out your loan, in much
the same way that a credit card provider can charge an annual fee for owning
the card. While this fee can bring down your interest rate, it's more sensible
to take out a loan with a low rate and no fee, as there are plenty of these
around. Some lenders also charge you the equivalent of two months' interest if
you choose to repay your loan early. Early repayment of your low cost loan can
seriously reduce the money you spend on it, so try to pick a loan that is easy
to pay back if you find you can afford it.
Choosing a Low Cost Loan
The best low cost loan is one that has a low, fixed APR, no arrangement fee and
no early repayment fee. You might think that this perfect loan is hard to find,
but there are plenty out there if you know how and where to look. Be careful if
your credit rating has been damaged though: your application for a low cost
loan will probably be rejected and your credit score will suffer. Use our free
postcode model to ensure that you are choosing only from providers who are
likely to accept your application.
The MoneyExpert.com comparison service
can search through all available loans for you, giving you a simple table
of the best low cost loans for you and a summary of the key product features.
Just answer a few simple questions about the type of loan you're after, and it
will do the rest for you.
Compare Low Cost Loans
with MoneyExpert's comparison service. It's free and
impartial, and will only take a couple of minutes of your time. Once you've
decided on a loan, you can then apply for it online there and then.