Steady on, it’s only representative!
Don’t forget: advertised loan and credit card rates are only representative. They can give you an idea, but there’s no guarantee what you’ll actually end up paying.APR is tailored to your unique circumstances and history. Only 51% of successfully applicants get those rates, and 49% may end up with a more expensive loan than the one that caught their eye to begin with. Unfortunately, the only way to find out whether you’ll be able to get the advertised rate is to apply, and this leaves a search on your credit file, which can hinder your ability to get credit in the future. So, it’s worth making sure the loan you’re going for looks promising before you apply.
How can I lower my APR?
There are a couple of things you can do to get a lower APR, which can save you a few bob. Generally speaking, a low APR indicates lower interest rates and low associated fees.
- Check your credit report.Lenders will be more likely to lower the APR on a personal loan if you have good credit. Good credit indicates you’re at lower risk from defaulting on the loan. Borrowers that seem high-risk will usually have to take higher interest rate loans, although low APR loans with bad credit are still possible.
- Extend the term of your loan.Another way of lowering your APR is by extending the term of your loan. This will drive down your monthly repayments and mean you pay less over the course of the year. Of course, it also means you’ll be paying your loan back for longer and mean you end up shelling out more in the long run, so be careful and don't be seduced by lower rates over a longer period. The golden (and flexible) rule of borrowing is to borrow as little as possible and pay it back as quickly as possible!