Your Questions About Personal Loans Rates
Richard asks…
Are banks able to change interests rates in existing fix-rate personal loans in case of high inflation?
I’m thinking of taking a personal loan with Barclays. It is a fixed rate 5-year loan. Does anyone know if there are any clauses that would allow the bank to change the interest rate in case of high inflation? In other words, even if the inflation raises to 15% or hyper-inflation kicks in will I still be expected to pay only the interests agreed in the contract or does the bank have some ways of adjusting the interests it charges according to increased inflation. Are there any laws that regulate this? Have you heard of any such clauses being used by any of UK banks?
Thanks,
Greg
Joe answers:
Fixed means fixed no matter what.
That’s why banks like to push adjustable rates, because then if inflation and interest rates go up, at least some of their outstanding loans will go up, so they aren’t hit as hard by inflation as they would be if all their loans were locked in fixed rates.
Steven asks…
Any idea personal loan interest rates on coming down in india?
recently finance minister made a statement to banks to reduce the interesr rates.By this banks already reduced by house loans by 50-100 basic points.
Any idea on interest rates coming down for personal loans
Joe answers:
Quite hopeful shoud come down by abot 0.75 to 1 %
John asks…
What can increase your interest rates on your credit cards and personal loans with variable rates?
I was a day or two late on paying some of my credit cards, and instead of just getting a over the limit fee….I noticed my interest rates jump up from like 10% to 18%, but that might have been for some other reason too, perhaps they gave me an indtroductory interest rate which expired or something, all of my cards are under 2 years old.
What can make the interest rate jump on your cards? Can it ever go back down again?
Also, what makes interest rates jump on personal loans with variable rates, and can those ever go down again once they’re up?
Techncially how high and how low can they go?
Is this economy to blame for alot of those? I also don’t seem to be getting credit limit increases normally either like I used to.
Joe answers:
Your interest rate increased because you were late. Credit card companies have a no tolerance rule when being late on a payment. Be happy that it didn’t increase to the default rate which is usually 28%. But be cautious, another late payment could possibly increase your rate higher. Creditors are able to increase your rate (up to the default rate, see your contract) for any reason they see fit. Unfortunately, your rate will never go down unless you ask for a program to assist you paying your debt off. Asking for a program though will close out your credit card and report to the credit bureau as closed per creditor (not consumer.)
Economy is to blame for some credit issues. Yes, fewer credit card offers are being mailed, Lines of credit are being reduced and APR’s are increasing even to people with A+ credit.
Sorry to hear about your interest rate. Credit cards are sure handy but the credit card companies can be ruthless! I once worked as a debt collector and then I worked as a financial credit counselor.
Powered by Yahoo! Answers
