The Truth About Cheap Loan Protection Insurance

The Truth About Cheap Loan Protection Insurance



The Truth About Cheap Loan Protection Insurance
Finding cheap loan protection insurance is​ no mean feat today .​
Recent Bank of​ England interest rate increases and the​ ongoing investigation by the​ Financial Services Authority into payment protection insurance (PPI) have resulted in​ high street banks increasing available loan rates .​
As a​ direct result of​ the​ loan rate rises,​ loan cover has increased in​ price,​ thus making cheap loan protection insurance virtually extinct.
The Bank of​ England base rate is​ at​ its highest level since March 2001 and at​ the​ time of​ writing,​ (August 2018) currently stands at​ 5.75% .​
Whilst this may be good news for savers,​ it​ represents decidedly bad news for borrowers .​
The sub-6% loan rate was all but gone before July 2018,​ when the​ interest rate increased,​ as​ a​ result of​ a​ dip in​ high street bank and lender profits,​ a​ knock-on effect of​ the​ Financial Services Authority investigation into payment protection insurance .​
Many lenders had been accused of​ ripping off consumers by offering poor value products .​
However,​ the​ loan rate increase has since justified even more expensive cover,​ thus eliminating cheap loan protection insurance for the​ majority.
However,​ that is​ not to​ say that cheap loan protection insurance is​ not still available .​
It is​ still out there but consumers do have to​ take the​ time to​ shop around in​ order to​ find it .​
Standalone payment protection providers are now providing high street banks and lenders with competition and that may actually serve to​ reduce costs for the​ consumer in​ the​ future.
Cheap loan protection insurance,​ when taken out in​ the​ form of​ a​ standalone policy,​ can save the​ consumer a​ lot of​ money .​
Not only is​ the​ premium less,​ but also monthly premium payments make it​ more affordable over the​ course of​ a​ loan and the​ independent nature of​ the​ cheap loan protection insurance actually protects it​ from the​ interest rate that is​ routinely added to​ it​ if​ the​ total cost of​ protection is​ added onto the​ loan repayment .​
In any terms,​ it​ makes sense to​ look at​ all of​ the​ options before settling for a​ specific provider!




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