End of the mega hotels of personal loans?

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Surprisingly cheap of high value of loans and 0% credit card balance transfer deals could be coming to an end, an expert has suggested.

Andrew Hagger, an analyst at financial consultancy Moneycomms, said that the 3% interest loans of more than £ 10,000 were now very rare.

The length of the credit card 0% balance transfer deals is also shortening.

Concerns have emerged that an era of cheap loans has led many young people to rely too much on credit.

The City regulator, the Financial Conduct Authority, and the Bank of England have expressed concerns about young people to get credit during a period of low interest rates to pay for basic living costs. This could expose financial difficulties when rates rise.

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Mr Hagger said that the latest “best buy” tables, marked a departure from the offerings available in recent years.

He said that it was more expensive to borrow large sums of money, and the longer 0% balance transfer periods credit cards that had fallen from 43 months in the start of the year to 38 months, with some falling at a faster pace.

“I suspect that the sub-3% personal loan may soon become a thing of the past, and I doubt that we get to see the record of 43 months 0% balance transfer time limit breached again,” he said.

A balance transfer effectively allows a borrower to use a new credit card to pay the debt of another credit card. The lack of compliance with payment term can leave people in a serious spiral of debt, the charities warn.

Figures published by the Bank of England last week showed that unsecured borrowing through loans, overdrafts and credit cards continues to grow at 9.6% in a year, but that this rate had declined slightly during the summer.

In October, the research from BBC News showed young people, in particular, are concerned about the amount of debt they are carrying and your ability to pay the debt

This was corroborated by the director of the FCA, Andrew Bailey, who said: “There is a marked accumulation of debt among the younger age group.”

He said that the consumers and the institutions that provide them, you must be aware of that rates of interest may arise in the future and that the credit must be “affordable”.