Advertised Loan Intrest rates on MoneySavingExpert

FrankRizzo

Why do loan companies advertise interest rate on their site but when you apply you get a higher interest rate than initially advertised?

This makes shopping around extremely difficult. !!!128533;

[Deleted User]

Because you are a higher risk applicant, so get a higher rate.

Lenders show the headline rate, that 51% or more of accepted applicants will receive.

Pixie5740

FrankRizzo wrote: »

Why do loan companies advertise interest rate on their site but when you apply you get a higher interest rate than initially advertised?

This makes shopping around extremely difficult. !!!128533;

Representative APR. 51% of successful applicants receive that rate you are one of the 49%. It's been covered ad nauseam on the forum. It's also covered on the MSE website.

https://www.moneysavingexpert.com/loans/personal-loans-apr-examples/

FrankRizzo

Ok great thank you! I’m going to apply for Tesco below and see how much the rate shoots up !!!128516;. You would think the FSA or whoever would take issue with this?

The representative example: If you borrowed £11,000 over 1 year at a representative rate of 4.9% APR, plus £33 borrowing fee included and an annual interest rate of 4.3% (fixed), you would pay £941 per month. Total interest cost over the term would be £288, meaning you would pay £11,288 in total (£11,000 loan + £288 interest).

[Deleted User]

No. The wording is compliant and the FCA won't mind you applying for a loan.

FrankRizzo

I think Martin should start a campaign !!!128515;

[Deleted User]

For what purpose?

Pixie5740

FrankRizzo wrote: »

Ok great thank you! I’m going to apply for Tesco below and see how much the rate shoots up !!!128516;. You would think the FSA or whoever would take issue with this?

Why do you think the FCA (FSA no longer exists) would take issue with this?

The majority of successful applicants get the advertised rate and the rates are being advertised as representative not absolute. Would you prefer it if lenders just straight out rejected you 49%ers?

Have you tried using the MSE loan eligibility calculator or are you just applying for loans willy nilly?

Clive_Woody

FrankRizzo wrote: »

Why do loan companies advertise interest rate on their site but when you apply you get a higher interest rate than initially advertised?

This makes shopping around extremely difficult. !!!128533;

They don't, I've always got the representative rate advertised.

DCFC79

FrankRizzo wrote: »

I think Martin should start a campaign !!!128515;

Another poster who has a gripe with lenders not offering the representative rate.

What exactly do you want Martin to do Frank ?

No he won't start a campaign on something that's perfectly fine.

FrankRizzo

Clive_Woody wrote: »

They don't, I've always got the representative rate advertised.

Do you know how they assess what rate a customer should get?