Our Rates - What Is The APR on Quick Loans?
Competition Lowers Prices, Not Regulation
The Rate You Pay If Your Application Is Accepted
Interest rates and charges are a tricky subject. Before the internet, lenders would come to the market with just one rate. These days' lenders will generally offer rates that match the status of the applicant. Lenders will take the data provided on application forms, compare it to credit reference agencies and use it to determine if a loan can be given, then calculate the charges for that loan.
In some ways, this is better than it used to be because those borrowers can still get credit offers rather than being turned away completely. It also means borrowers with a better history are not paying for the mistakes of those borrowers who defaulted on their loans for one reason or another.
Credit History | Max Loan | Max Months | Average APR |
|---|---|---|---|
Bad / Poor | £1500 | 12 Months | 112.5% |
Average | £3000 | 18 Months | 48.9% |
Good | £5000 | 36 Months | 24.2% |
Excellent | £10,000 | 60 Months | 14.8% |
Different Lenders
Each lender that we work with will have its own rates and risk levels. Lenders spend a lot of money on researching what type of applicant is the most likely to default. By doing this, they can understand the risk that each type of customer represents. All lenders keep these factors a highly guarded secret, and they refuse to make them public. When we submit your application to lenders, we will only be able to relay a small number of details to the applicant: a) on whether or not that application has been accepted, b) at what rate (APR).
If you find the offered rate acceptable, you will click "proceed" and complete the process to get your money. If you do not judge that rate as fair or affordable, you can simply close your internet browser, which will terminate the application.
Typically, the cheapest way to borrow money is through a bank. Unfortunately, since the downturn of 2008, banks have become more difficult to obtain credit from (none of the lenders on this site are banks). This leaves those who can't get credit from mainstream lenders needing to find alternative sources.
"Alternative sources" is usually a term given to those who charge higher interest rates. There are now caps on certain loan types, such as those for less than 12 months. There is an ongoing debate on whether or not this makes it cheaper for most people or more problematic for the majority to be accepted.
Most people will now find that interest rates on the web bear little resemblance to the base rate of interest listed by the Bank of England.
Different in rates between short term lenders and the Bank of England Base Rate?
There is a noticeable difference between the Bank of England base rate and the rate of interest that short term lenders can charge. The Bank of England charges as low as 1% APR, whilst unsecured private lenders charge up to 99%.
Unlike sites like Quick Loans, The Bank of England's rate reflects the risk of financial institutions failing and taking the economy with them. Sites like ours charge interest rates that reflect the risk of the borrower not repaying the money.
We know there is a lot of misconceptions on Social media about lenders not offering fair rates. That would be true if we could borrow money from the Bank of England at their rates - but sadly, we can't. Only banks and high-end mainstream financial houses can borrower from the BofE.
Most sites like this borrower from private financiers, then lend on to customers. The rates they charge us is quite high.
That is why rates are different.