HSBC offers cheapest loan ever!

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HSBC has launched the cheapest personal loan ever, with a rate of just 3.9%.

HSBC has launched the cheapest personal loan ever, with a rate of just 3.9%.

HSBC has cut its personal loan rate down to just 3.9% APR, the lowest rate on a loan ever.

The new low rate is available on loans of between £7,000 and £15,000 for existing current account customers, and £7,000 to £25,000 for Premier account customers. However, it's not available to those who don't bank with HSBC.

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How it compares

Here's how it compares to the best of the rest in the medium-size loan market currently, taking the example of a £10,000 loan over a five-year term.

Loan

Representative APR

Monthly repayment

Total amount repayable

HSBC Existing Customer Personal Loan*

3.9%

£183.40

£11,005.20

Hitachi Personal Loan

4.1%

£184.28

£11,056.80

Tesco Bank Personal Loan4.1%£184.28£11,056.80

M&S Bank Personal Loan**

4.1%

£184.28

£11,056.80

Zopa A* Personal Loan

4.1%

£184.49

£11,069.40

Cahoot Personal Loan

4.2%

£184.89

£11,093.40

M&S Bank Personal Loan4.2%£184.89£11,093.40

AA Personal Loan

4.3%

£185.15

£11,109.00

Sainsbury's Bank Standard Nectar Cardholder Loan

4.3%

£185.15

£11,109.00

Sainsbury's Bank Non Nectar Cardholder Standard Loan

4.3%

£185.15

£11,109.00

Santander Personal Loan

4.3%

£185.32

£11,119.20

Clydesdale Bank Personal Loan

4.3%

£185.36

£11,121.71

Yorkshire Bank Personal Loan

4.3%

£185.36

£11,121.71




*Available to current account customers only

**Available to existing bank customers only

Twelve months ago, the cheapest medium-sized loan was 4.9%, so borrowers now have an extraordinary range of cheap deals to pick from. So even if you don't bank with HSBC and have no intention of moving your current account, there are plenty of decent alternatives that don't cost much more.

It's worth noting that because of the different ways lenders calculate the interest and fees, the monthly repayment and total amount repayable may vary, even though the representative APR is the same.

I've been offered a higher rate

Unfortunately even if you are accepted by HSBC (or any of the other lenders in the table for that matter) you may not be offered the advertised rate. That's because lenders are only obliged to offer this rate, known as the representative APR, to 51% of successful applicants.

So if there are any black marks on your credit record, you may be offered a more expensive deal. You can check the state of your credit record with a free trial of CreditExpert.

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How to dispute your credit record

How to dispute your credit record