Tesco Bank is one of the best banks in which to apply for loans thanks to a triple cut in the rates. The rate cuts were offered for the low, mid, and high range personal loans, valid for periods ranging from 1 to 20 years, depending on the purpose of the loan.
The rates dropped from 7.8% to &% APR, and are for loans ranging from £5,000 to £7,499. Only Sainsbury’s Bank and Santander offer better interest rates which stand at 6.9%. This cut in rates means that a person taking out a three year loan of £6,000 will pay £79.29 less.
Mid-range loans of £7,500 to £15,000, which are the most common in the UK will come at an interest rate of 5.1% APR , down from 5.2%, which equals those of Sainsbury’s Bank, Derbyshire Building Society, and Clydesdale Bank. High-Range loans of £15,001 to £25,000 come at rates of 7.2% APR, down from 7.4%.
Since the loans are based on APR, the lender only offers these rates of 51% of its successful applicants. This means that credit rating will be a factor affecting the approval of the loans.
According to David McCreadie, of Tesco Bank, the rates are regularly reviewed to give competitive offers to customers, a fact exemplified by the recent changes. Customers are bound to get a good deal at the bank irrespective of the purpose of the loan. This is as a result of the £80bn Funding for Lending Scheme, which has forced lenders to slash their rates as a result of the easy access to cash.
Tesco offers these rates for loans going up to 10 years, unlike others who offer them for 5 years. All loans falling under £15,000 usually go for 5 years, but they can now be extended to 10 years. Loans over £15,000 have a limit of 10 years, apart from those used for refinancing which have a ceiling of 7 years.