Alliance & Leicester has cut 0.5 per cent off its unsecured personal loan rate, reducing the figure to 6.1 per cent.

The lender says with one fifth of British consumers saying they want to reduce their debts in 2006, and a further 22 per cent claiming they will look into switching their current financial products in the new year, the rate cut could be a welcome boost to post-Christmas finances.

The personal loan is being offered to customers applying for a loan between £7,500 and £20,000 and provides great value. A loan of £7,500 with the rate will cost just £8,694.

Commenting on the cut, personal loans manager for Alliance & Leicester, Claire Alvey said: “Our low-rate loan is now one of the most competitive deals available over the phone, on the internet and on the High Street, reflecting our commitment to offering excellent deals.

“As many of us have over-indulged recently on food and drink or on the cost of Christmas, it is no surprise that more than half of us want to review our finances in the New Year. Shopping around for a good deal on financial products should be a top priority.”

Ms Alvey added that the personal loan would come in handy for those people wishing to consolidate their debts into one payment.

“This will give them the discipline of having to make just one fixed monthly payment, a definite ‘end date’ for their debt and a fixed rate of interest for the term of their loan, whilst saving a large amount of money,” she added.

© Adfero Ltd