Comparing Loans Various Interest Rates: check the APR before applying for a loan.
No matter what type of loan you are looking for and what options you have, the most important factor that you must focus on is the APR (Annual Percentage Rate).
Comparing loans various interest rates in one place
The Annual percentage rate or simply known as the rate of interest is the most important attribute of any loan. You may want a home loan, car loan, student loan, personal loan, business loan or you may want an unsecured loan if you don’t have any security, collateral or guarantor.
Representative 277.5% APR - Representative Example: Amount of credit: £750 for 12 months at £119.21 per month. Total repayment of £1430.52. Interest: £680.52. Interest rate: 140% pa (fixed). 277.5% APR Representative.
You may also need loans that are available for applicants with bad or low credit. Every type of loan has certain requisites. From the purpose of the loan, to the loan amount, the profile of the borrower or applicant to the credit score, everything matters in the loan application and subsequent approval process.
You would obviously be comparing loans various interest rates but you should know how to go about it. First, you must understand how rates of interest are influenced.
Secured loans for applicants with good credit will have the least annual percentage rate. That is why mortgages have lower rates of interest. When you look for a student loan or car loan, the rate would sky-rocket.
The rate would increase exponentially when you take a personal loan or business loan. If you are looking at unsecured loans, then the APR would be in a whole different ballpark.
From single digit rates of interest in cases of mortgage to as high as 25% in case of unsecured loans for applicants with all credit types, that is the kind of range you are looking at.
There are good rates at the moment
But the good news is that there are many lenders or financial institutions and companies that don’t charge you exorbitantly. There are companies that offer loans to applicants with all credit types at an interest rate of less than 10%. But the same company will have the provision of charging as high as 24% or more.
The eventual rate of interest in a particular case will depend on the loan amount, repayment term, the credit score of the applicant and the entire application including the aspects of the individual’s profile.
When you consider the various loans at your discretion, focus on the APR or rates of interest and then decide which one you would go for. A slight difference of 2% can become a difference of several thousand pounds depending on the loan amount and repayment term.
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