Michelle Slade, of Moneyfacts said: "Since August 2006 the average rate on offer for a £5,000 loan over three years has increased from 8.1% to 11%. With no signs that conditions are going to get better in the near future, rates could move much higher."
The cheapest deals on a £5,000 loan are similar to seven years ago. Back then, the best deal was from Northern Rock at 8.5%; the best today is from Moneyback Bank at 8.4%.
If you borrowed £5,000 over 5 years with Moneybank Bank, your monthly repayment without payment protection insurance would be £101.69, with the total amount payable being £6,101.40. So your total interest charges over the 5 years would be £1,101.40.
In the past month or so Bank of Ireland, Bradford & Bingley, Lloyds TSB and Marks and Spencer have all hiked the rates on their personal loan products.