Anyone that has even applied for an unsecured loan knows that it can be very confusing. Not only must you ensure that your credit rating is as good as it can be, you may not actually qualify for the advertised ‘teaser’ rate. Indeed an outright decline can have a negative effect on your credit rating and make it even harder for any future applications. Until now.
An increasing number of lenders will now offer you the chance to provisionally apply using a ‘soft search’ method. This search will not leave a black mark on your credit file should you be declined, and will give an indication as to whether or not you are likely to be accepted. Indeed ASDA money have gone one stage further and will now offer unsecured loans that are “tailored to individual financial situations”. In a new partnership with Freedom Finance, they use soft search technology and review numerous lenders to maximise the customer’s chances of being accepted, and can now offer more rates better suited to the customer’s individual financial circumstances. Katie Walley head of ASDA money said “Our strong belief and analysis of the current market was that a new and different approach to personal loans was desperately needed to better fit the needs of our customers and consumers who are constantly turned down or offered a rate that doesn’t suit them.”
Thus the idea of ‘tailored’ borrowing is now something that most customers would definitely benefit from, especially those who are worried about being accepted in the first place. Rachel Springall finance expert at Moneyfacts stated that “borrowers looking for a competitive loan rate but afraid of damaging their credit score with multiple applications will be delighted by this new loan from Asda Money which offers soft search technology and a more personal approach,” and starting with a rate of 2.8% places them on par with the lowest rates currently available on the market, so it’s a great starting position for its launch.”
Indeed the unsecured personal loans market I general is at the most competitive it’s ever been, so it is an excellent time to consider applying for a loan. Rachel noted further that “the personal loans market is rife with competition and the challenger banks and supermarket bank brands tend to offer the lowest rates, starting at 2.8% from TSB and M&S Bank, and now Asda Money. She added further “even if customers don’t get approved for the lowest possible rate, they are still going to see a reduction in interest compared to years gone by. In the last five years alone the average rate on a loan of £10,000 has fallen from 8.1% to just 4.6%.”
So what that means for the customer is that repayment amounts are far lower than in previous years. With technology and lending evolving all the time, it seems that at last lenders are finally listening to customer needs, and there has never been a better time to apply for that loan.