Best Loans News

A new study conducted by a leading independent financial trends organisation, has discovered that the popularity of personal loan products soared during the first quarter of 2007.

The accumulative total of new loan applications is said to have topped more than £16 billion pounds from January through to April, representing an increase of around 5% faired against Q1 2006.

It has also been discovered that total consumer savings for the same period were in decline. The accumulative total of consumer savings for Q1 2007 peaked at £38 billion pounds, representing a drop of almost 17% faired against the first 3 months of 2006.

It is not entirely known as to why consumer loan hunger had increased so dramatically for the first quarter of 2007, but analysts suggest that market conditions were the most likely contributor.

National interest base rates have rose on 4 separate occasions so far this year. It is possible that consumers were snapping up cheap rate loan deals pre interest rise number 2, for fear of offers being withdrawn. These types of conditions would almost certainly spur individuals who were considering loan procurement at later stages in the year, to move their plans forward in order to save money.

The above theory could also be used to explain the slump in national savings. Logically, if consumers looking to source a loan at later stages in the year, we’re to suddenly bring their plans forward, it is highly likely that their saving routines would be disrupted. In essence, consumers would be focusing a percentage of their disposable income towards the additional financial commitment, which ordinarily would have been saved.

It is further suggested that the total number of new loan applications for the second quarter of 2007 will have decreased substantially, compared to Q1. Rate conscious individuals will have been deterred to some degree by the recent spate of interest hikes, although we are yet to see the stats. Please check back soon to read our follow up report.