Switching credit cards loans what makes you change provider
Below is a MRR and PLR article in category Finance -> subcategory Loans.
Switching Credit Cards and Loans: What Makes You Change Providers?
Summary
Recent polls from moneyfacts.co.uk reveal that 38% of people have switched credit card providers due to poor customer service, and 36% have avoided certain providers based on friends' negative experiences. For personal loans, 18% switched due to bad service, while 40% avoided specific providers.Article Body
The latest moneyfacts.co.uk polls highlight a key reason people switch credit card providers: poor customer service, affecting 38% of respondents. Additionally, 36% choose to bypass certain companies because of negative feedback from friends.When it comes to personal loans, the situation is similar but with slightly different dynamics. While 18% have switched providers due to unsatisfactory service, a significant 40% have avoided specific lenders entirely.
These statistics underscore the importance of customer service in financial decisions. People expect fair treatment and helpful support when dealing with personal finances. Furthermore, word of mouth plays a critical role. Negative experiences are often shared, whereas positive ones are less frequently discussed.
Interestingly, fewer people switch personal loans compared to credit cards, mainly due to early repayment penalties, which can amount to hundreds of pounds. Therefore, it's crucial to assess any potential fees before deciding to leave a lender, even if you're unhappy with their service.
Deciding to avoid a provider based on customer feedback is a personal choice. However, with the vast differences in rates for loans and credit cards, it's wise to shop around. For instance, loan rates can vary dramatically, from 5.5% to over 20%. On a £10,000 loan over five years, this variance can lead to monthly repayments differing by over £50, totaling more than £3,000 over the loan term. Thus, it's crucial to not jump at the first offer. Keep in mind that the rate offered might depend on your credit rating, which lenders use to assess creditworthiness. Always confirm the actual rate you're being offered before committing.
Credit card interest rates can exceed 20%. If you have a £1,000 balance at this rate and are only making minimum payments, transferring to a card with a 0% balance transfer deal could save you over £100 in a year.
In conclusion, whether you're considering a new credit card or personal loan, weigh the benefits of competitive rates against potential pitfalls like hidden fees and poor service. A little research can make a significant difference in your financial well-being.
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