Other lenders to withdraw in the last two years include: The AA, Britannia BS, Direct Line, Goldfish, Intelligent Finance, Liverpool Victoria, Lombard Direct, MBNA Europe Bank, MINT, Northern Rock and Virgin Money.

Those lenders that remain in the market have increased the cost to borrowers, with the average rate on a £5,000 loan increasing by 3.7%.

Louis Kaszczak, Head of Moneyfacts.co.uk, commented:

“Many lenders are pulling away from unsecured lending as the risk of customers defaulting continues to increase.

“Latest figures show that unemployment has risen once again. Borrowers struggling with repayments will inevitably forgo repayments on unsecured lending first, while trying to maintain their secured lending commitments such as their mortgage.

“Those lenders that do remain are charging a much higher rate of interest in order to offset the potential risk.

“Borrowers requiring a £25,000 loan over five years will now have to pay an additional £1,334 in interest, compared with two years ago.

“78% of the loans available on the market are risk based pricing. Only two thirds of customers will get the advertised typical rate.

“While shopping around is key, borrowers need to be wary of making too many applications as this will leave a mark on their credit file and may have a detrimental effect on their changes of being accepted for a loan.“

www.moneyfacts.co.uk - The Money Search Engine

Moneyfacts.co.uk is the UK's leading independent provider of personal finance information. For the last 20 years, Moneyfacts' information has been the key driver behind many personal finance decisions, from the Treasury to the high street.

Comments

admin@prime-targeting.com
03 Aug 09, 06:41

mack

According to me people should invest after considering all investment factors like liquidity, returns and risk. Liquidity will give you the info about how faster you can convert your stock in real money, there most important factor is returns. Everyone invest money for some good returns and last one is risk. There are always some chances of risk in any type of investment, to earn more returns you have to take more risk. So, always invest after considering all the above important factors. For more details on Unsecured Markets refer http://www.prime-targeting.com/secure-stability-in-the-unsecured-markets/

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