Secured loan provider Picture Financial says a quarter of the UK population reckon getting their finances properly organised is more important to their happiness than sex, food, work or the weather.

But they won’t be feeling so happy if they decide to make a Picture loan a part of that process.

Its typical annual interest rate is 8.4 per cent, but borrowers may be asked to pay as much as 10.9 per cent, depending on their credit history - at a time when best-buy unsecured personal loan providers are charging only around 6 per cent.

That may not sound like a huge difference, but with a minimum Picture loan of £10,000 and a minimum repayment term of 10 years, that’s a very expensive commitment.

At a rate of 10.9 per cent, it would cost a total of £16,461.

Borrowing the same amount over just five years at a rate of 6 per cent would cut that to £11,599 - a difference of almost £5,000.

To add insult to financial injury, Picture takes a charge over borrowers- homes, which means it can force a sale if they fall behind with their repayments.

So if you need to borrow to get your finances organised, for goodness sake shop around for a better loan deal than this.

This entry was posted on Wednesday, May 23rd, 2007 at 7:27 am and is filed under UK Personal Finance, Loans. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.