Sainsbury's Bank launches personal loan sale - but you'll need to act fast

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Sale. Price labels
Sale. Price labels



Sainsbury's Bank is holding a rate sale on its medium-sized personal loans.

The supermarket has knocked 0.1% off the cost of borrowing between £7,500 and £15,000 on its Standard and Reward Shopper deals, until 3pm on 23rd September.

Sainsbury's has two types of deals you can go for.

The Standard Loan offers the supermarket's top rate and comes with a price promise to undercut rivals. With this deal Nectar cardholders get a preferential rate over some borrowing terms compared to non-Nectar cardholders .

Alternatively there's the Shopper Reward Loan, which is only available to Nectar cardholders. This loan won't offer the best rates but offers 5,000 bonus Nectar points and double Nectar points for two years.

What you can get in the sale

A record low rate of 3.9% is now available with the Sainsbury's Bank Standard Loan for those with a Nectar card wanting to borrow between £7,500 and £15,000 over 12 to 36 months. For those without a Nectar card, the rate is 4%.

However, both Nectar cardholders and non-Nectar cardholders that would rather repay the medium-sized loan over 37 to 60 months will get a rate of 4%.

Alternatively those looking for a Nectar boost can go for a rate of 4.2% over 12 to 36 months, or 4.3% when borrowing over 37 to 60 months with the Sainsbury's Bank Shopper Reward Loan.

How Sainsbury's compares

The Sainsbury's rate sale has moved it into a market-leading position when borrowing between £7,500 and £15,000 over 12 to 36 months.

Here's how Sainsbury's compares on a loan of £7,500 taken out over three years.

Loan

Representative APR

Monthly repayment

Total amount repayable

Sainsbury's Bank Standard Loan(Nectar Cardholder)

3.9%

£220.87

£7,951.32

HSBC Personal Loan*

3.9%

£220.87

£7,951.32

Sainsbury's Bank Standard Loan(Non-Nectar Cardholder)

4%

£221.19

£7,962.84

Zopa A* Personal Loan

4%

£221.34

£7,968.24

First Direct Personal Loan*

4%

£221.32

£7,967.52

Tesco Bank Personal Loan

4.1%

£221.51

£7,974.36

Hitachi Capital (UK) PLC Personal Loan

4.1%

£221.51

£7,974.36

M&S Bank Cardholder Loan**

4.1%

£221.51

£7,974.36

AA Personal Loan

4.1%

£221.51

£7,974.36



*Only available to existing current account holders

**Only available to existing bank customers

However, when it comes to longer term loans the Sainsbury's Standard Loan for Nectar and non-Nectar cardholders isn't the clear leader.

Here's how the supermarket compares on a loan of £7,500 taken out over five years.

Loan

Representative APR

Monthly repayment

Total amount repayable

HSBC Personal Loan*

3.9%

£137.56

£8,253.36

Sainsbury's Bank Standard Loan(Nectar and non-Nectar Cardholders)

4%

£137.88

£8,272.80

Zopa A* Personal Loan

4%

£138.05

£8,283.00

First Direct Personal Loan*

4%

£138.01

£8,280.75

Tesco Bank Personal Loan

4.1%

£138.21

£8,292.60

Hitachi Capital (UK) PLC Personal Loan

4.1%

£138.21

£8,292.60

M&S Bank Cardholder Loan**

4.1%

£138.21

£8,292.60

AA Personal Loan

4.1%

£138.21

£8,292.60


*Only available to existing current account holders

**Only available to existing bank customers

HSBC offers the cheapest rate when borrowing over the longer term, however it's only available to current account holders.

Sainsbury's Bank's Standard Loan sits second in the best buy tables. However, it could still beat HSBC with its price promise.

This guarantees to undercut your best offer on a like-for-like loan by 0.1%.

You need to have applied for the Standard Loan and been accepted, but not signed the loan agreement. You also need to provide proof of a better offer within 28 days of receiving your Sainsbury's deal.

So if HSBC offers you its headline rate of 3.9%, you could get an even better offer of 3.8% from Sainsbury's.

However, this involves applying for two loans which doesn't look great on your credit record.

A word of warning

Loan providers only have to offer their headline rate to 51% of those that are accepted.

So you could be one of the 49% that gets offered a worse deal.

For more on how to improve your chances of getting the best deal read: How to build an excellent credit history.

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