Competition in the personal loans market is as hot as ever, so much so that one loan provider has slashed rates to the lowest on record – but only to those who fit the bill. The shopping bill, that is…
Sainsbury's Bank announced earlier this week that it was cutting rates on loans of £7,500 to £20,000 by 0.1% APR, which means successful applicants will now be charged a rate of just 3.1%. This is the lowest rate we've ever seen, and means those looking to consolidate their debts, make a few home improvements or arrange a big purchase can enjoy the lowest repayments ever.
However, there are a few caveats to this record low deal. First off, this rate is only available to those who opt for a repayment period of three years or less, with those seeking longer repayment terms needing to put up with slightly higher rates (although even these are still competitive).
Secondly, the deal is only open to Nectar cardholders, so you'll need to be a card-carrying member of the supermarket giant's reward scheme to qualify. This could be a small price to pay, however, as even if you're not a member yet, you'd simply need to sign up to benefit from the same low rate as loyal Sainsbury's shoppers.
It's worth pointing out that the loan also comes with more typical restrictions, such as minimum age and income requirements, but these are commonplace in the sector.
Even if this loan isn't quite for you – perhaps you want to borrow a different amount or need a longer repayment term – now's still a great time to take advantage of things. As this latest rate cut shows, providers are still locked in competition in an attempt to attract new borrowers, and typically, when one provider lowers its rates, others will follow.
Our own figures back up this trend, with average loan rates having been on a definite downward spiral in the last few months. This means there could be even better deals to come, but why wait? There's no guarantee, so take advantage of the current competition by heading to our personal loan calculator to see if there's a deal that can meet your needs.
Before you use our loan calculator, remember to make sure your credit score is up to scratch. Compare credit check providers to get an idea of your rating and get an extra layer of confidence when you apply.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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