More means less where loans are concerned. Although the gap between rates for a £5,000 loan and a £7,500 loan are narrowing, it is still cheaper to borrow a larger sum of money, if you are able to. But it is actually becoming increasingly difficult to obtain a loan.

According to MoneyExpert.com the average rate for a £5,000 loan is now 10.16% compared with 9.4475% in November 2007. The average rate for a £7,500 loan is now 8.88% compared with 7.97% in November 2007. It says rates on the most competitive deals have increased from 6.4% in November to around 6.9% now. This is despite Bank of England rate cuts.

"The Bank of England has a battle on its hands to restore confidence in the credit markets when lenders react to three rate cuts totalling 0.75% by actually increasing rates,” comments Sean Gardner, founder of MoneyExpert.com. "You will pay lower rates on average if you borrow more. Lenders take the view that those borrowing more are generally a better risk than those borrowing less and offer better deals as a consequence."

On the whole lenders are imposing increasingly tough criteria on borrowers. Figures from YouGov state that around 1.38 million people have had loan applications turned down over the past six months. "The unsecured loans market is almost mirroring the mortgage market where the issue is not so much rates but availability , but whether or not lenders will let you have the cash,” says Sean Gardner. “"However it remains the case that creditworthy customers can still access competitive deals and borrowers should research the market carefully before making an application.”

MoneyExpert.com claims the most competitive deals at £5,000 include Your Personal Loan (6.9%), which is only available to homeowners, Wesleyan Personal Loan (7.4%) and Moneyback Loan (7.9%). It says the most competitive £7,500 deals include ASDA Personal Loan (6.9%), Tesco (7.2%) and Moneyback (7.2%).