Low interest rate loans UK

APR stands for Annual Percentage Rate and represents the true rate of interest that is payable on a loan. Because of the way prices and interest rates can be packaged, lenders are obliged by law to state the APR clearly - not to do so would be extremely misleading. The figure that you get for APR will include not only central interest rates but also other charges, such as loans administration costs added by the lender.

The way APR is charged can also be a bit unclear and the main factors to look out for are whether it is charged at a fixed rate or whether it is subject to variations - 'a variable rate'. In simple terms the difference comes down to whether you will be paying the same rates over a given term or whether it can go up or down. In the end it is a bit of a gamble and your choice will depend on how safe you want to play it. Go with a fixed rate and you will not benefit from a reduction in interest rates, opt for a flexible rate and you may see your repayments on your UK loan increase.

In taking on loans UK borrowers should be looking at the APR as the true cost of the loans. Do not compare loans without considering the APR because the APR represents the true cost of a loan.