Yahoo Finance 
Last chance to get lowest-ever loan rate
Sainsbury’s is to increase the rates on its personal loans on Monday, meaning you have just a few days left to take advantage of the lowest-ever rate.
For loans of between £7,500 and £15,000 repaid over four or five years, Sainsbury's is offering a representative APR of 4.9%.
Here’s how this shapes up to the competition, based on the example of borrowing £10,000 over a five-year term.
Loan | Representative APR | Total amount repayable | Monthly repayments |
4.9% | £11,266.20 | £187.77 | |
4.9% | £11,266.20 | £187.77 | |
5% | £11,292 | £188.20 | |
Yorkshire Bank Online Personal Loan | 5% | £11,292 | £188.20 |
5% | £11,292 | £188.20 | |
5% | £11,292 | £188.20 |
However, if you can pay that loan off in between one and three years, you can cut the rate down to just 4.8% – the lowest ever offered on a personal loan.
The table below details how things change if you can pay that £10,000 off in three years.
Loan | Representative APR | Total amount repayable | Monthly repayments |
4.8% | £10,740.60 | £298.35 | |
5% | £10,771.56 | £299.21 | |
Yorkshire Bank Online Personal Loan | 5% | £10,771.56 | £299.21 |
5% | £10,771.56 | £299.21 | |
5% | £10,771.56 | £299.21 |
As you can see, Sainsbury’s tops the tables whether you can pay the loan off over one year or five, so it’s a shame that its deals will be pulled imminently.
However, in truth the difference between the monthly repayments on its loans and the other best buys is a matter of pence, so there are still plenty of great options if you’re in the market for a loan.
Will you get the representative APR?
One thing to bear in mind is that not everyone who applies successfully will actually get that advertised rate. Lenders are only obliged to offer the rate to 51% of successful applicants. So even if they say yes to your application, you may get lumbered with a higher rate.
The decision will come down to your credit score. If it's not so great, you might want to think twice before applying and leaving a record on your credit report.
If you want to improve your credit score for the future, make sure you're on the electoral roll, you don't miss repayments on any credit agreements you have (anything from mobile phone contracts to utility bills), and don't make countless applications for credit.
