'Loans have never been so cheap'
Published On 16 May 2007
It could be a very good time to consider a loan - such as a homeowner or debt consolidation loan - a leading consumer website has revealed.Figures from moneysupermarket.com show that the margin between the Bank of England's base rate and typical interest rates charged on all types of loans has narrowed significantly in recent years.
This means that loans represent a better value borrowing option.
Last week, the base rate increased to 5.5 per cent and the website says that the best loan rate currently available is approximately 5.9 per cent.
In March 2003, interest rates stood at 3.75 per cent but the best loan deal available offered a rate of 6.7 per cent.
"Loans have never been so cheap," said Tim Moss, head of loans at the website. "In fact, as the base rate has risen, typically loan rates have fallen.
"This means the profit margins are narrower then ever for the loans providers and consumers are getting a damned good deal."
Figures from Credit Action indicate that six million UK consumers have taken out a debt consolidation loan to ease their financial worries.
