4. PERSONAL LOANS: Can you lower interest rates to 2.8%?

Borrowing is dirt cheap (relatively) right now, but with rate hikes subject to change, ask yourself one simple question: Can you get a new loan to pay off your existing one and pay less?

The answer is more complex, however, as it’s not just a matter of finding a cheaper APR, but there may be a few months’ early repayment fees. Total help with reducing existing borrowing costs, but here’s a quick A, B, and C:

A) Ask your current lender for a “settlement number”. For example, how much it will cost to pay off your current loan, including any prepayment costs (which tells you how much a new loan needs to be to pay off).

B) Find the cheapest loan for the “Billing Number” and if you can get it. Our credit score calculator shows your chances of being accepted for many loans – it’s really worth checking before applying. See Cheapest Loans (APR Examples) for the full current cheapest interest rates, but in brief…

– £1,000 – £3,000: Hitachi* 9.8% rep APR (card loans may be cheaper)

– £3,000 – £5,000: Hitachi* 7.9% rep APR (card loans may be cheaper)

– £5,000 – £7.5,000: Sainsbury’s* 3.3% rep APR (Nectar cardholders)

– £7,500 – £15,000: M&S*, Cahoot*, Santander* and three others are 2.8% rep APR

Be warned, however, that all of these lending rates are “representative annual percentage rate of charge” which means that unfortunately only 51% of accepted customers need to receive that rate. However, through our Eligibility Calculator, we have some cheap lenders who are now offering guaranteed rates.

C) Find out if a new loan is cheaper than your current one. Multiply your monthly repayments by the number of months you have left (ask the lender if you don’t know) to find out how much you’ll pay if you stay. Or just plug the numbers into our Loan Switch Calculator, which will do it all for you.