How fit are your finances?
If you’re new here, you may want to subscribe to my RSS feed. Thanks for visiting!Applying for a new loan or credit card is a competitive business, with the best deals going to the people who have the fittest credit history. If you want to be in the running, you need to remember the old [...]
Learn MoreRescued Banks charge extortionate rates for personal loans
As a provider of money saving advice , I can understand banks and finance institutes charging high interest rates to clients that have a less than perfect credit report where they have missed payments, fallen into arrears, been issued with defaults and county court judgements. But it looks like these banks were charging these interest rates to everyone. Banks must be allowed to judge risk and charge accordingly for the risk.
The Bank of England started pumping £75 billion into our financial system last month in an attempt to resuscitate our economy and to provide the banks with liquid money to start lending again for mortgages, personal loans, car finance and business loans. It was thought that we may have seen some of the best mortgage deals and remortgage deals due to the low Bank of England base rate which currently stands at ½%. It is being reported that some of the banks that the government bailed-out with taxpayers’ money are now charging taxpayers up to 21% interest for some personal loans.
Rescued Banks charge extortionate rates for personal loans
Homeowners have seen the value of their properties nose-dive, savers have seen their income from their savings diminish, unemployment has risen to over two million, the cost of living has risen sharply over the last year and now some of the very banks that were saved from going bust by the taxpayers are now charging interest rates that are astronomical. It seems that a personal loan has a higher interest rate than a credit card. Bizarre!
The Daily express reported that one of their investigators was offered an interest rate of 21% for a £2,000 personal loan over three years by the Nat west Bank and a similar 20.9% by the Lloyds TSB. It seems that the Nat West spokeswoman said: “All loan applications are assessed on the customers personal circumstances and information provided.” With interest rates at these levels it is little wonder that many people are struggling and are unable to get out of debt. Many people need help with debt not high interest rates if they are ever to be debt free
These extortionate interest rates do fly in the face of the government who has bailed out these banks to restore confidence in the banking system and to get the banks to start lending money. The banks look to have chosen to continue their greed by extorting their customers further in the pursuit of profit and money. For external reviews and comparisons, please take a look at Loan Providers.
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It’s sad to see the situation just as bad now as it was in April. Lenders are now anticipating increases in interest rates which will inevitably come at some point to further jack up the cost of borrowing. Even the advertised rates are poor but the fact that those with good credit history can’t even get them make the whole industry a bit of a joke at the moment. Anyone trying to renew a tracker mortgage now is having a really hard time.
ReplyInteresting read. Thanks for this informative stuff. having bad credit scores are pathetic. I have held up in debt prison very badly and was aiming to get a personal loan, but poor me, I never able to get one with reasonable interest rates.
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