HSBC has launched the cheapest personal loan ever, with a rate of just 3.9%.
HSBC has cut its personal loan rate down to just 3.9% APR, the lowest rate on a loan ever.
The new low rate is available on loans of between £7,000 and £15,000 for existing current account customers, and £7,000 to £25,000 for Premier account customers. However, it’s not available to those who don’t bank with HSBC.
How it compares
Here’s how it compares to the best of the rest in the medium-size loan market currently, taking the example of a £10,000 loan over a five-year term.
|
Loan |
Representative APR |
Monthly repayment |
Total amount repayable |
|
HSBC Existing Customer Personal Loan* |
3.9% |
£183.40 |
£11,005.20 |
|
4.1% |
£184.28 |
£11,056.80 |
|
| Tesco Bank Personal Loan | 4.1% | £184.28 | £11,056.80 |
|
4.1% |
£184.28 |
£11,056.80 |
|
|
4.1% |
£184.49 |
£11,069.40 |
|
|
4.2% |
£184.89 |
£11,093.40 |
|
| M&S Bank Personal Loan | 4.2% | £184.89 | £11,093.40 |
|
4.3% |
£185.15 |
£11,109.00 |
|
|
4.3% |
£185.15 |
£11,109.00 |
|
|
4.3% |
£185.15 |
£11,109.00 |
|
|
4.3% |
£185.32 |
£11,119.20 |
|
|
4.3% |
£185.36 |
£11,121.71 |
|
|
Yorkshire Bank Personal Loan |
4.3% |
£185.36 |
£11,121.71 |
*Available to current account customers only
**Available to existing bank customers only
Twelve months ago, the cheapest medium-sized loan was 4.9%, so borrowers now have an extraordinary range of cheap deals to pick from. So even if you don’t bank with HSBC and have no intention of moving your current account, there are plenty of decent alternatives that don’t cost much more.
[SPOTLIGHT]It’s worth noting that because of the different ways lenders calculate the interest and fees, the monthly repayment and total amount repayable may vary, even though the representative APR is the same.
I’ve been offered a higher rate
Unfortunately even if you are accepted by HSBC (or any of the other lenders in the table for that matter) you may not be offered the advertised rate. That’s because lenders are only obliged to offer this rate, known as the representative APR, to 51% of successful applicants.
So if there are any black marks on your credit record, you may be offered a more expensive deal. You can check the state of your credit record with a free trial of CreditExpert thanks to lovemoney.com. And if it needs some polishing, be sure to read How to repair your credit rating.
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