Personal loans now more expensive, research shows

Thu, 27 Mar 2008

Obtaining a personal loan is now more expensive than it was at this point last year, new research shows.

The data, compiled by Moneyfacts, found that anyone taking out a personal loan of £5,000 over a three-year-term now could pay up to £385 more over the lifetime of the product than if they had taken it out this time last year.

Samantha Owens, head of Personal Finance at Moneyfacts, said: "Unsurprisingly the personal loan market has not escaped the effects of the credit crunch . In 2008 alone we have seen 27 changes to personal loan products."

She added that as with the mortgage market, a number of lenders have now stopped offering personal loans .

Lenders that are still provide personal loans are now applying more strict criteria when vetting applicants, she concluded

Earlier this month, MoneyExpert revealed that there has been an increasing demand for personal loans from those looking to consolidate debt run up on things such as credit cards .
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