Santander loan APR...

_h2o_

Hi all

Due to some unfortunate circumstances I need a loan for 5000. I applied through my bank (Santander) and I qualified although they couldn't offer me the advertised 8.3% due to my credit rating (I've never faulted on payments etc, I just have no credit cards).
I was told minimum they could offer me is 15.9% which I thought was a bit high but affordable. The paperwork arrived for me to sign today and I've discovered that there is a 15.9% interest rate on the 5000 PLUS 15.9% APR. This means a total repayment of 6600 on 5000 over four years!
Is this a typical repayment figure from a high street bank?? It seems extortionate to me and I certainly wont be taking the loan at those rates... Surely theres a more realistic lender out there.

Thanks

demondoctor

Thats sounds right to me. £5,000 over four years at 15.9% APR would mean repaying around that amount.

CLAPTON

_h2o_ wrote: »

Hi all

Due to some unfortunate circumstances I need a loan for 5000. I applied through my bank (Santander) and I qualified although they couldn't offer me the advertised 8.3% due to my credit rating (I've never faulted on payments etc, I just have no credit cards).
I was told minimum they could offer me is 15.9% which I thought was a bit high but affordable. The paperwork arrived for me to sign today and I've discovered that there is a 15.9% interest rate on the 5000 PLUS 15.9% APR. This means a total repayment of 6600 on 5000 over four years!
Is this a typical repayment figure from a high street bank?? It seems extortionate to me and I certainly wont be taking the loan at those rates... Surely theres a more realistic lender out there.

Thanks

what would you expect to pay in total if you borrow 5000 over 4 years at 15.9%?

Tixy

You'll only be paying 15.9% APR on the deal. As said above that works out at £6660 if paid over 4years.

15.9% APR is not a great rate at the moment but its far from a bad rate.
Whether you could get better elsewhere will depend on your financial circumstances as well as your credit history, but the more applications you make that appear on your credit file then the more likely you are to be refused as applying for a lot of credit close together makes you look desperate for cash. People are generally advised not to have more than 3 applications within a few months.

iolanthe07

There are people who post on here who would be delighted to be offered a loan at 15.9%. It is high, but not extortionate, and reflects the current lending climate.

_h2o_

Thanks for replies.

Excuse my naivety but I didn't realise that 15.9% APR would mean I'd eventually pay back 32% on top of the 5000!!

Tixy

15.9% APR is annual percentage rate - if you had a £5000 loan and paid nothing for a year and then paid off the full amount 1 year later then the interest you would pay would be 15.9% of the loan.
If you had a £5k loan repaid monthly over 1 year then your loan would be a lot cheaper (it would only cost £400ish over the year in interest), because you want to pay it over 4years the interest is understandably a lot more.