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'Switch providers to save on loan repayments'

Borrowers can make significant savings by changing their loan provider halfway through the repayment period, it has been claimed. According to research conducted by price comparison site, the average consumer with a loan of £8,000 could save £180 by swapping for a best buy deal. However, despite the savings to be made many borrowers are reluctant to change provider, with 2.5 million saying they would not consider the move on the grounds that the savings are too small. Meanwhile, a further six per cent were not aware that switching providers is possible. Mike Naylor, personal finance expert at, said: "In such a volatile unsecured personal loan market, five years is a long time to sick with the same provider as rates fluctuate constantly. "For example, in the second half of 2007, more than 30 providers increased loan rates by around one per cent APR. However, since the last base rate cut at the beginning of December, eight major lenders including Alliance & Leicester, Moneyback, Lloyds, Barclays and Sainsbury's have already cut their rates by up to 5.5 per cent APR." He continued: "With more base rate decreases predicted over the next 12 months it's possible that we may see other providers following this example and offer more competitive deals than those available last year."

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