Sainsbury’s Reduces Loan Rates October 31st, 2011
The war amongst lenders to be able to offer the most competitive cheap loan deal on an unsecured loan is continuing, as Sainsbury’s Finance have just announced their new cheap loan deal, which undercuts their main lending rivals.
The latest round of loan rate reductions started a few weeks ago, with Tesco bank reducing the rate on their unsecured loans between £7,500 and £14,999 to just 6.4 per cent. Within days of this announcement, the Nationwide Building Society lowered its rate on the same loan amount band, to just 6.2 per cent, for its flex account customers.
Sainsbury’s have now announced that their loan rates on unsecured loans of between £7,500 and £14,999 will start from just 6.2 per cent, for loans with a term of up to 5 years. However, this rate will be lowered to just 6.1 per cent for loan terms of three years or less, as an incentive for borrowers to pay off their loans quicker.
The advertised loan rates will be available to nectar card holders only and will be subject to an individual’s personal circumstances and credit score. The loans will be available for both new purchases, such as a car, or as a debt consolidation loan, which could save existing borrowers a significant amount of money compared with their existing loan rates.
Tim Moss of Moneysupermarket.com said “This is really great news for customers who are looking for a loan at a good rate and Sainsbury’s have also made it slightly more competitive to take the loan over a shorter term, which is commendable and means the loan could be paid off sooner.”
“We haven’t seen a loan product with this APR since 2007 and it could be a sign that other loan providers may follow suit soon and cut their interest rates and the next round of the loan rate wars begins.”