The international credit crunch has permeated each and every corner of the financial sector and earlier this month it was the sphere that suffered from the ever increasing interest rates.

Despite the Bank of England reducing its base rates in both December and February, rates are still steadily climbing. This has made securing a personal loan even more difficult as it seems the lending institutions themselves are struggling to fund the financial needs of their customers. Their struggles are having far reaching consequences as their customer’s bear the brunt across the board regardless of the amount being borrowed.

Money Expert states that a personal loan of £2,500 has seen a general increase in the rates being offered from 9.49% to a massive 10.11% in a period of only 3 months. The same period saw the  same rise in interest for those taking out the larger amount of £5,000 from 9.76% to an upsetting 9.93%, even more interesting is the overall picture.

On average the rates have increased from 10.62% to a whopping 11.4%, this is very bad news for those taking out unsecured loans as the full amount payable will be far from pretty. With rates set to increase further regardless of the actions taken by the Bank of England to ease the consequences of the credit crunch it is essential for people to ponder over whether they really need to take out a personal loan or if there are other ways to correct their credit conundrums.