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The area of finance and loans can be a real minefield for consumers, with a vast range of lenders offering a wide choice of loan products and packages. Many consumers find themselves totally confused when it comes to taking out a loan, and with so many different companies and lenders now flooding the market it can be difficult to decide who to go to in order to get the right loan at the right price.
Traditionally, high street banks have offered a range of loan products, and continue to do so today, with competitive rates, affordable borrowing, and a choice of packages on offer.
However, with so many other lenders now offering financial products and loans many consumers have benefited from using a loan broker, who can source a wide range of lenders on your behalf in order to find a loan that suits your needs, circumstances, and budget.
Bank Loans
With many reputable and well known banks offering a range of loans and some very competitive interest rates, many people could benefit from taking out a loan directly with a high street bank. Some of the things to bear in mind with regards to bank loans include:
- Most high street banks will only consider customers with a good credit rating, and therefore if you have a low credit rating or poor credit history you may not be able to get a loan with a bank.
- Banks generally tend to offer a good range of financial products, including both secured and unsecured loans.
- If you are already a customer with the bank you may be able to get a preferential interest rate based on the bank's own policies.
- Some banks may charge arrangement fees or administration fees for loans, so you should check this before you make any commitment.
- Customers with good credit could find that they area able to get better deals on loans direct through a high street bank rather than through a broker.
- You do not necessarily have to be a customer with the bank through which you are getting the loan, so compare the different loans on offer before you make a decision.
Broker Loans
With so many different lenders in operation these days, most people have neither the time nor the resources to contact each one individually in order to find the right loan.
A loan broker is able to do this on your behalf, taking your details, information, and requirements, and then accessing a wide network of suitable lenders in order to find the right loan deal for you. If considering using a broker, you should remember:
- Many brokers deal only with secured loans, although there are some that also help those looking for unsecured finance.
- Because brokers have access to and links with a wide network of lenders throughout the UK they are more likely to be able to find a suitable loan for those with a tarnished credit history or rating, as they will know which lenders are prepared to lend to bad credit consumers.
- Brokers usually charge arrangement fees for loans, but in some cases the fee is taken from the lender rather than the borrower. Make sure that you look into this, and if you, as the borrower, are responsible for paying the fee make sure that you know up front exactly how much it is going to cost.
Finding the right loan is easy
Although the choice available when it comes to finding the right loan can seem confusing, there are pros and cons to using both a bank and a broker to find your loan.
You should weigh up the advantages and disadvantages to help you to determine whether a broker can help you to find the best deal or whether the bank may have just the loan you are looking for.
If you want to compare some of the loans available in order to help you to find one that suits your needs and your pocket you can do so quickly and easily through our comparison pages:
Secured loans - If you are looking to borrow a large sum of money secured on your property.
Unsecured loans - If you are looking for an unsecured personal loan of up to £25,000.
You can also compare loans by:
Bank loans
Broker loans
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