Tuesday 15th January 2008
The cost of borrowing is increasing and rose dramatically over base rate rises last year, it has been claimed.
According to new data from MoneyExpert, the rate on a loan over £3,000 has risen from 12.35 per cent in November 2006 to 14.9 per cent.
Meanwhile, the rate on a loan of £12,500 or above has grown from 7.1 per cent to 8.78 per cent.
The growing repayment costs spell trouble for UK borrowers already struggling with affordability and higher utility bills, chief executive of MoneyExpert Sean Gardner said.
"With the cost of living on the increase the obvious thing to do for anyone feeling the strain is to borrow money to tide themselves over. But people who want to take out a loan to consolidate debts or to make a large purchase must be wary of the overall cost," he explained.
"A set of monthly payments may seem manageable but you always end up repaying much more than you borrow. The golden rule is only borrow what you are certain you can afford to repay," he added.
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Loans
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