The Anonymous Widower

Getting A Loan Of £5,000 Or Less

I don’t need to borrow money, but I do have a trap setup to make sure that I get information about Zopa and the other peer-to-peer lenders, as obviously I want to put my money in the best places.

I found this article, entitled.

 Money Insider: Want a loan of £5,000 or less? Shop around,

In yesterday’s Independent. The article has some interesting things to say about borrowing money and this in particular about Zopa and Ratesetter, two of the peer-to-peer lenders.

Zopa, the first peer-to-peer lender in the UK, is now in its eighth year and RateSetter, one of the more recent lenders in the peer-to-peer market, both offer some of the best value deals at 9.5 per cent APR and 9.7 per cent APR respectively for a £3,000 loan over three years. Just because you’re not familiar with the names doesn’t mean you should discount them — the peer-to-peer market has quickly established itself as a credible alternative to the big banks — and the interest rates are much better than you’ll find on the high street. Zopa has already lent more than £230m and RateSetter has advanced more than £36m to personal customers.

It also highlights another prudent way to borrow from MBNA.

Another option is the Rate for Life card from MBNA. Although not strictly a personal loan, there’s nothing to stop you using this long-term fixed-rate credit card in the same way you would as a loan. If you transfer your balance to the card and set up a monthly standing order for your current account, it works exactly the same as a personal loan.

All of this adds up to the fact, that the banks are under pressure to maintain their traditional place in the financial field. The second paragraph I’ve highlighted illustrates this, in that conventional wisdom says that borrowing on a credit card is an expensive business and should avoided at all costs.  If I’d heard this in the pub and not read it in a respected newspaper, I wouldn’t have believed it.

But as in all things these days, the rule of innovation applies; innovate or die. The banks do little of the former and are flirting with the latter.

October 14, 2012 - Posted by | Finance, News | , ,

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