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How Long Will Interest Rates Be Kept Low In the UK? What about people with bad credit?
If you are wondering why the UK government kept the interest rates low, you need to know that it is a part of their politics. It is not about helping people with bad credit, however you can still benefit from some lower interest rates.
By: Laura F Wolf Solvemybadcredit
You might think why are interest rates still high on credit cards and loans. Compared to the 0.5% you have to pay 8% on the average £7.000 to £14.000. You need to know that the 0.5% is not the price banks are getting their money for, as they have got loads of bad debt out. So the price they pay for the money they lend is much higher.
Recently some supermarket chains announced a price war, and if you have bad credit, you should have a look at these offers. Sainsbury's Bank is offering loans at 6.9%, compared to 7.9 % before. Tesco has also lowered their interest rate to 7.4% from 7.500 to £14.999.
If you were to look at balance transfer offers on credit cards, you will still have a better range of choice than before. The interest rates have been lowered, and the interest free periods extended. If you are taking out a credit card, you will also have to look into the extra services and benefits. Supermarket chains offer double points on loyalty programs, and if you are using the chain regularly, it can get you a great saving over the course of a year.
But what if you have bad credit? Lending criteria hasn't really been lowered, as the risk involved in lending unsecured finance is still high. Unemployment is still a problem in the UK, therefore if you have bad credit debt, you will have to face higher interest rates. You will either be declined finance, or be offered a higher APR. Before applying for consolidation loans, check your credit rating, and find a suitable product.
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I have seen many people struggle with bad credit in the UK recently. We have to find a solution for eliminating debt and starting a new, debt-free life. More resources: http://www.solvemybadcredit.co.uk