11 August 2009 / by Andy Davies
Nationwide Building Society has reduced its personal loan rate to 7.7 per cent typical APR, which represents a 0.2 per cent decrease on the previous rate.
The reduction makes Nationwide a market leader when it comes to offering loans of up to £10,000 as closest rivals Abbey and Alliance and Leicester offer typical rates of 8.6 per cent APR.
Welcoming the news, Tim Moss at Moneysupermarket.com, said: “Nationwide has really bucked the trend in the loans market by offering its existing customers the most competitive personal loan rate available by quite some margin.
“Loan rates have been going up since the start of the credit crunch – in April 2008 best buy loans were around 7.34 per cent, but have now risen to closer to 9 per cent.”
Mr Moss believes this could be a sign that the loan market is recovering, he added: “This is an indication of green shoots in the loans market and if others follow suit there will be a big shift in the cost of borrowing for consumers.
“As unsecured loans are the riskiest of all lending for banks, a movement such as this to gain market share is great news for consumers.”
The new loan rate applies Nationwide FlexAccount holders who borrow between £5,000 and £14,999 before October 6 when the offer expires.
Successful applicants can get a personal loan with repayments scheduled between one and seven years.
Chris Rhodes, product and marketing director at Nationwide, said: “We are rewarding our current account customers with the lowest personal loan rate in the UK which underlines further the benefits of taking out and using a Nationwide FlexAccount.
“This will be the first of many offers for Nationwide current account customers over the coming months.”
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