Abbey National Loans

www.abbeynational.co.uk/index/loans_home.htm

Abbey National loans are a good deal if you're borrowing a lot of cash – typical APR 6.9% for amounts of £5,000 or more – and rubbish for smaller amounts, with APRs ranging from 16.4% to 19.9% for sub-£3,000 loans. Secured Abbey National loans are better value, but APRs are variable.

About Abbey National Loans

Abbey National loans look simple, but when you read the detail you'll quickly get a headache. Different APRs apply to different products; some have fixed rates, others variable. If you're borrowing a small sum the interest rates will scare you silly, whereas if you go for a secured loan you'll get a very low APR – albeit a variable one, which could be bad news if interest rates rise.

Unsecured Abbey National loans are the simplest, but they can be pricey. The quoted 6.9% APR is for borrowings of more than £5,000; borrow less than three grand and the rate could soar to 19.9% APR. Interest rates are fixed, though, and payment protection is available.

Secured Abbey National loans are more complex. There are two products: the Discounted Home Improvement Loan, and the CAT Standard Home Improvement Loan. The former is a discounted variable rate loan; the latter is a tracker loan that adds 1% to the Bank of England base rate. In practice that means at the time of writing the discounted loan weighs in at 5.2% APR and the CAT loan 5.1% APR – around 1% lower than a standard variable rate loan.

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