Loans
Egg Loan
Our Online Loan Buys *
| Typical APR | Per Mth | ||
|---|---|---|---|
|
8.5% | £203.65 |  |
|
8.6% | £204.10 | |
|
8.6% | £204.10 | |
|
8.7% | £204.55 | |
|
9.1% | £206.15 | |
| * Based on £10000 over 5 years and is not a full search of the whole market | |||
The Egg Loan, offered by online financial services provider Egg, is a flexible personal loan that offers you the option of early repayment with no penalty - you can make additional payments at any time and you can also increase your payments at any time. This is good news for those of us who are able to pay the debt off in this way.
The quicker you pay off your Egg Loan, the less it will cost you. Egg offers this facility - many lenders don't. With some lenders you can be faced with the equivalent of up to two months' interest if you choose to pay your loan off early.
On the other hand you may want to take advantage of the Egg Loan's repayment breaks. The Egg Loan allows regular payment holidays; so long as you've made three consecutive monthly repayments, you can take a break for up to three months in any 12 month period. This can give you extra flexibility in your budgeting, which could be useful if you are self-employed, for example.
However, you must remember that while you are not paying back what you borrowed, interest is still being charged on the outstanding debt. A repayment holiday is not the same as an interest holiday! There are no hidden fees with the Egg Loan but if you take an involuntary repayment holiday - that's to say if your direct debit repayment is not made without prior arrangement you'll be charged an extra £20 with your next repayment.
How a Egg Loan works
With the Egg Loan, you may choose how much you want to borrow - any amount (to the nearest pound) between £1,000 and £25,000 and you can choose how long you take to repay your loan between six months and seven years.
The Egg Loan's quoted typical 7.9% APR is reasonably competitive but it is not the cheapest rate available and you'll need to be looking to borrow more than £5,000 to get it. Egg operates a banded interest rate and loans between £1,000 - £4,999 are charged a typical 14.9% APR.
In keeping with its flexible approach, Egg's loan payment protection plan, should you opt for it, allows you to choose what kind of cover you take. You may choose whether to cover yourself against accident and sickness or unemployment or both. With either policy, life cover is also included.
Egg was originally created by financial services giant Prudential in 1998 as new kind of online personal finance business. Egg became a quoted company in its own right in June 2000 but Prudential, with 79% of the shares, is still firmly in control of the business, which now has around 3.6 million customers.
You may be thinking of applying for an Egg Loan because of the flexibility that it offers. However, before you decide finally you should always shop around. The Egg Loan may well be right for your circumstances but other loans may suit equally as well and may even be cheaper. Using a search tool like Moneyextra's loan comparison service will allow you to see quickly and easily whether the Egg Loan really is right for you.
Last updated April 2008
Nothing in this article constitutes investment advice or a recommendation by Moneyextra to invest in any product, or employ any service, mentioned or advertised.