Cheap loans have now become common in the UK as more loan companies come onto the market, creating more competition.

If you're looking for a cheap loan, your main priority is probably to save money, so here are tips on finding a cheap loan that's suitable for your requirements.

Cheap loans are generally repayable on a monthly basis. If there is a degree of flexibility then the lender may permit over-payments and lump-sum payments, both of which allow you to clear the debt over a shorter time period than first agreed.

When you're looking for a cheap loan, you probably just think about the interest rate (or APR), but there are other charges to consider that might make a difference. For instance, some lenders charge a loan arrangement fee when you apply or a fee for rapid delivery of the money into your account.

Like credit card companies charging an annual fee, this might bring your interest rate down, but you'd be better off looking for a cheap loan with no fees and a low rate.

You might also be asked to pay an early repayment fee, or settlement charge. This will only apply if you decide to pay off your cheap loan before the cheap loan term expires, but lenders can charge the equivalent of up to two months' interest for this.

Even if you don't think you'll be able to settle your debt early, it's worth looking for a cheap loan that doesn't charge for early repayment, just in case.

If your cheap loan is a truly flexible product then you may also be able to withdraw funds from the account on a rolling basis, providing you stay within your credit limit.

Lenders also offer repayment holidays or payment breaks, allowing you to take a break from your monthly repayments either at the start of the cheap loan (known as 'deferred repayment') or at an agreed point during the term.

Interest will continue to accrue on the outstanding balance and this may result in increased monthly payments so your debt is still repaid over the term agreed at the outset.

Getting accepted for a cheap loan can sometimes prove difficult if you’ve got bad credit, have changed addresses frequently, have no previous credit history or are self-employed. There are lenders who can help those who need 'bad credit' cheap loans and those who have difficult personal circumstances.

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