Best Personal Loans

Lenders often offer better deals for online applications

Once you've found the best personal loans on offer from lenders, have a look online to see if there are any special offers for online applications. In many cases there are, so for example Sainsbury's Bank offers an APR of 7.1% to phone customers but as little as 6.5% online.

When you look for the best personal loans, sites such as This Is Money (www.thisismoney.co.uk) and MoneyFacts (www.moneyfacts.co.uk) can help you draw up a shortlist. Once you've found the list of lenders you want to consider, it's a very good idea to check their online rates: for example, while Sainsbury's Bank charges an APR of 7.1% for customers who apply by phone, the rate for online applications can be as low as 6.5%. That doesn't make a big difference for smaller loans, but if you're borrowing a lot of cash then it makes sense to get the cheapest possible APR.
It's worth remembering that the best personal loans tend to come with conditions attached: the current best buy, 6.0% APR from Northern Rock, is only offered to customers who meet fairly strict criteria. In particular, you must not have been refused credit in the last six months. Other loans have hidden penalties: Sainsbury's Bank can give you an APR of 6.5% - instead of its usual 6.9% APR – but there's a penalty for early settlement.

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