Consumers receive loan guidance

Borrowers have been issued with personal loan repayment advice by an industry publication.

According to a report by the Thrifty Scot, consumers should be conscious of the fact that the rate of interest advertised with borrowing is often different to the actual level of repayments they face.

Due to this Britons were advised to carry out research into finding the right personal loan deal for them.

However, the publication warned that if consumers shop around too much "then banks think that other financial institutions have turned you down".

As a result, borrowers were urged to ask lenders "hypothetical questions" such as what they may think interest rates payable on loans could be.

Consumers were also recommended to ask their credit providers about what would happen to the cost of borrowing if they were to miss making payments due to unexpected illness or unemployment.

Taking on secured borrowing was also suggested as "interest rate on an unsecured loan is substantially higher than the interest on a secured loan".

Last week, Britons were advised by Which? Money to beware lenders who add payment protection insurance charges onto personal loans without informing customers, a move which could increase the cost of borrowers’ monthly repayments.

Interfinancial providing you with breaking personal loan news.