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Dump Dangerous Debts Today!

According to the Office of Fair Trading (OFT), up to seven out of ten credit advertisements break advertising regulations.

The OFT's review, conducted between November 2004 and February 2005, found that three out of five loan ads (60%) in regional newspapers failed to comply with tougher rules aimed at making it easier for borrowers to compare loans. In well-known car magazines, almost seven in ten ads (a whopping 68%) didn't meet the guidelines laid down in the Consumer Credit (Advertisements) Regulations, which came into force last Halloween. Crikey!

Many adverts broke the rules by failing to show the typical annual percentage rate (APR), which is a serious offence. Other ads displayed more than one typical APR (as many as six were quoted in one ad!), failed to display the typical APR prominently enough, or not the typical APR with information on fees and payments. In total, the OFT has warned 28 lenders about incorrect advertisements.

Although the OFT and Trading Standards Services have promised to crack down on persistent offenders, you should remain on your guard. For the moment, the golden rule is: don't apply for loans that are advertised in the back of papers or magazines. After all, if these lenders are bending the rules on advertising, they may be up to no good behind the scenes, too. What's more, incorrect information about a loan's rates and charges could make it unenforceable, so it's in lenders' interest to get their facts right!

Personally, I'd never apply for a loan that was advertised in the press or on television, especially if the campaign is fronted by some D-list celebrity; see I'm A Celebrity - Never Buy From Me! In addition, as I explained in Five Tips To Choose A Loan, you won't find Best Buy loans on high street - more like 'Don't Buy' loans! No, my many years in financial services have taught me that the best place to find bargain loans is online.

Indeed, you'll find the UK's cheapest personal loan, currently topping the best of the Best Buys on Moneyfacts, in very own Personal Loans centre. For the record, moneyback bank, a member of the Alliance & Leicester group, lends £1,000 to £25,000 at a typical fixed rate of just 5.5% typical APR, with up to five years to repay.

For example, a £5,000 loan over three years from moneyback bank will cost a total of £5,424.48 - £648 less than the £6,072.48 charged by HSBC at 13.9% APR. You won't find a cheaper loan anywhere, so don't look in the back of the papers - click your mouse instead!

More: Find your perfect personal loan here!