A quick look at Moneysupermarket’s loan panel shows 28 lenders listed on full results (based on search done on August 28 for a £12,000 loan over 6 years as a homeowner with mortgage). However, 20 do not have a “proceed” button. So you can’t even apply and get a true quote. Of the 8 with “proceed” button:

• 2 are exclusive to existing customers only (Nationwide and Barclays)
• 3 are brokers (UCC, Aspire and Ocean)

That leaves only 3 options available to all visitors… that’s a bit limited, isn’t it?

Most high street banks will now only offer prime unsecured loans to existing customers, Abbey, Nationwide, HSBC, Barclays, RBS, Natwest & Halifax are all restricting who they lend to in this way (see Daily Express article) .

Banks know their own customers better than anyone which reduces the risk to the banks. On this basis, it makes sense for customers to try their own bank for a loan or credit card before looking elsewhere.

If, however, you are not successful what should you do? Should you shop around – certainly but you do need to be very careful. Each time you apply to a different lender, you will be credit searched. Too many searches can damage your credit status and then make it even harder for you to get any type of credit.

You should also be careful when being tempted by those enticing ‘typical’ rates which most applicants simply will not get – particularly if you are not a customer of one of the banks named above. We’ve all seen those adverts in the travel agent’s window “a week in Majorca for £99” only to go in and find out that that holiday has gone but they can offer you a similar holiday for £499! It’s a bit like that with some banks and their low rate “typical” loan rates.

So make sure you only use a loan comparison website or an independent broker who can tell you your actual APR (applicable to your circumstances) before you apply.