loan or mortgage

nick_walker

hi, i want to borrow 20,000, is a personal loan the best option. or adding to my existing mortgage, also can anyone recommend anyone who offers a personal loan of more than 7yrs with a low apr.

also, it says on this website that its possible to get a loan at the moment with only a 4.6% apr, but this wasnt one of the lowest rates offered by your top lenders, they offer only 5.6%.why?

hope you can help me.
thanks very much.

nick walker.

regularsaver1

most unsecured loans do not go beyond 7 years, whereas an extention to your mortgage can. Meaning the longer the term, the smaller repayment, but more paid back overall

however, an unsecured loan probabaly would not have a fee, whereas on mortgage it probably will

if you want a separate payment then unsecured will do that - or a separate secured loan

but an extention of your existing mortgage will give you the one payment

worth finding out the rates too for comparisons

good luck

nick_walker

that was my first ever question on this site,
thanks for your quick reply, you have been very helpfull.
nick.

regularsaver1

Your welcome

let us know how you got on

Rafter

Nick,

The very best loan rates are often only available over 5 years. This is because the banks themselves are taking on more risk over a longer period that interest rates will rise, while you are holding a fixed rate loan.

The 4.6% APR probably refers to ZOPA which is small loans over a short period or to 'life of balance' credit card deals which again are unlikely to raise you the £20k you need unless your credit record is squeaky clean.

Remember if you add the £20k to your mortgage you are putting your home at risk and you will be spreading your payment over a much longer period. This might help your monthly income now, but if you are paying for something like a car or wedding, you don't really want to be paying this debt off in 20 years time.

Post some more information if you want more specific advice. What is the loan for for example?

R.