Is your personal loan lender a wolf in sheep’s clothing?

Seen an advert of a 6.99% personal loan interest rate only to be offered 12.99% once you submit an application? This happens all too frequently on the personal loan scene but it doesn’t have to be this way. There are a small number of personal loan lenders that offer you your own personalized interest rate, which is based on your credit worthiness, before you actually apply for the loan. If you then choose to apply and are approved, the rate they offered you is the rate you will get.

The reason why it is important to apply with ideally only one lender is that multiple credit enquiries will reduce your credit score (for more info please see previous blog about things that will affect your loan application). So in the above scenario where you may apply for a loan because you are interested in the low advertised rate but then are offered a higher rate, if you don’t take that loan and then go and apply at yet another lender, your credit score at this second lender will now be lower than it was when you applied with the first lender which may result in an even higher rate.

We have recently partnered with a really great personal loan lender who give you a personalized rate before you apply for the loan. How they do this is they conduct what is known in the industry as an "access seeker" on your credit file which does not leave a mark on your credit file or affect your credit score. This access seeker happens in a matter of seconds and you are then offered your rate. If you are happy, you can then apply for the loan.