Where can I get a loan?

The list is long and ranges from high street banks, to those that operate only on the internet or telephone, to building societies, credit unions, specialised loan companies and even doorstep lenders.

In recent years, companies that once offered insurance and other financial products have added personal loans to their portfolios. They include Direct Line, Norwich Union and the AA and their rates are often some of the most competitve on the market.

At the other end of the scale are companies that advertise on daytime television and in the back pages of the tabloids. Their typical APRs can hit 20% or more and many offer only secured loans, excluding non-homeowners.

Possibly the most expensive form of credit is offered by doorstep lenders. Unlike mainstream lenders, they will often offer sums of less than £50, which are typically used to cover unexpected purchases, and collect payments weekly.

However, APRs can be as high as 900% so borrowers who have a choice will tend to avoid them.

Credit unions are an alternative to mainstream lenders and can be an attractive option for some borrowers because they cannot charge more than 1% a month on the reducing balance of the loan (an APR of 12.7%).

If you borrowed £1,000 for a year, you would repay just £1,067. Most credit unions offer unsecured loans for up to five years and secured loans for up to 10 years.

The best buy loan for you will depend on how much you want to borrow and over what time period, and your personal circumstances.

Typically, cheaper deals are offered by the specialists and internet banks than are available on the high street, but this is not always the case so you should shop around, either online or by contacting lenders to get quotes.