I've had an Egg loan for the last 4 years after I consolidated my many credit cards. I've found Egg to be, in the main, one of the better banking-type companies I've had to deal with (as a serial credit card holder I've dealt with many different ones). Here are my pros and cons to a loan with Egg.
~Background to Egg~
Egg is an online UK bank based mainly in Derby that began in 1998. As an online bank there are no branches you can walk into, although you can phone a human if you need to. Egg claims to be the world's biggest online bank and sells many different financial products including current and savings accounts, loans, credit cards, mortgages, ISAs and insurance.
~A little aside on loans in general~
Over the years I've run up a monster amount of debt that I'm now having to deal with, and I've learned a lot from my mistakes. Before you even apply for a loan, firstly, ask yourself seriously - do you really need whatever it is you're planning on buying? Without meaning to preach, many people (me included in the past) buy lots of stuff on credit that we never actually needed in the first place. If you don't need it - don't buy it.
Secondly, can you afford it? A loan is not free money (contrary to my previous mindset).; you do actually have to pay it back, and it takes a lot longer to pay back than the enjoyment of whatever you bought is likely to last. If you can't afford to save up for it, you probably shouldn't be buying it in the first place.
Finally, carefully plan to only borrow as much as you can afford to be paying back each month. Trust me when I say that you really don't want to get to where I did with £38k in debts and £700 in minimum payments each month seriously hampering your life. Avoid getting into debt at all costs if you can!
Right, lecture over! You've decided that what you want is necessary, is worth the extra interest (rather than saving up for it), and you can afford the monthly repayments. So on to Egg itself.
1. An Egg loan is easily arranged (just go to their website www.egg.com, or call them direct, and apply) and, if approved, the money you borrow is paid quickly into the bank account you specify.
2. Egg loans have variable rates. Mine's been on 6.7%, which is fantastic for a long-term loan, (although I see they're advertising around 13.9% on their website now - if this is the interest rate you get offered then run a mile).
3. Unlike most of the other loans I looked at, Egg allow you to make overpayments on your loan, or even pay it off in full early without any charges - a small overpayment each month can make a real difference to your interest costs over 4-6 years and, if you're suddenly flush, you've got the option to unshackle yourself from this debt early without the usual penalty charge.
4. Egg allows you to take up to 3 payment breaks each year, throughout the time of your loan. Although this increases the overall interest you end up paying, it's a good backup system for a month where you have a giant emergency dentist bill or a cashflow problem. I've taken 4 or 5 over the years (3 in one bad year), and they're easy to arrange. You just ring up (before the date of your monthly payment), ask for a break, give them the reason why and they will tell you your new monthly repayment amount (it goes up slightly due to the missed payment); you agree to it and then they put it through the system. Easy.
5. Egg has been surprisingly flexible for a bank. I had a few payment breaks so the monthly payment amount became larger than I felt was sensible so I called them up to see what they could do. They were happy to reschedule the entire loan for me so that I pay less each month, but keep paying for longer. Yes, it increased my overall loan repayment a little (which is probably why they were quite happy to reschedule it) but it markedly decreased my stress levels when trying to find my payment each month as it became a lot more affordable and I could pay more off my higher-interest debts instead. Other banks over the years have not had such a flexible mentality to my debts so I really appreciate Egg's flexibility and helpfulness.
6. Egg have a clever 'money manager' online account system where you can put in all your online banking/credit card account details (including non-Egg accounts) once, and you can then access these accounts by simply logging on to your Egg account, without the need to input all the other details again. This is very helpful when, as I used to, you have 5 credit cards, 3 bank accounts and a loan - you only have to remember one set of passwords for all your accounts and you can keep an eye on your finances much more easily. I haven't had any problems with their online security.
7. Egg, on average, has excellent staff on the end of the phone. I've only encountered one unhelpful person in tens of phone calls over four years; the rest have all been friendly, courteous and very helpful. This beats all my other banking companies hands down and is in marked contrast to one that will remain nameless (for now!).
8. In fairness to Egg, they paid back my PPI as soon as I claimed they had mis-sold it - in full and without any quibbling.
~Onto the cons...~
1. Although, once you get through to a human, the phone service is excellent, actually reaching a human in the first place can be a protracted process of repeating your postcode five times until the automated computer finally recognises what you've been saying all along. 300 options and needless automated info about your account later you finally reach a living person. It can be very frustrating, but all my banks seem to have it so Egg is not alone in this pet-hate of mine.
2. Their website seems to be down quite often on Sundays, just when I want to update my accounts online.
3. Getting a loan so easily can land you into debt you should never have taken on - again, not only an Egg problem.
Overall I'd recommend a loan with Egg, as long as you can get a decent APR deal. My final comment, though, is a painful lesson learned by me: don't take out a loan to consolidate all your credit cards, and then run up all your cards again...
Egg loans are great when they work, but hideous when they don't!
They are easy to apply for, with a lower than average APR. One of the best things about Egg loans is that you can overpay your loan and bring your end date forward without penalty, or you can have a payment holiday for up to three months each year, if you have kept up to date with all your other payments. So if you hit a rough patch and finances are stretched, or if you come into some extra money, this is quite a flexible product, unlike most loans on the market.
However, when it goes wrong, the systems at egg cannot cope. I have been making overpayments on my account, but if you make an additional payment to your account within 14 days of your next direct debit being paid, the computer gets confused, can't allocate the direct debit (even though they have taken it from your bank) and they put it in a suspense account. At the same time they write to you and tell you that you are in arrears, and so the phone calls start from their collections department! And of course at this point you know you are actually AHEAD of your payments, and certainly not behind!
This takes time to sort out, and can be quite stressful.
My worst experience with Egg, though, was when their computer decided to set my direct debit request at £0 - this resulted in my account immediately being in arrears and was very quickly passed to a debt collector who was rather aggressive. Obviously Egg took it back into their control, as it was their error, but the stress of a debt collector calling me a dozen times a day was not the most pleasant experience of my life. It took the best part of a year to resolve this, and eventually they sorted it out.
So, a great product in theory and I am sure for most people it works well. But when it goes wrong, it goes wrong, and their customer service department don't always know what to do to put it right - very frustrating!
I have recently taken out an Egg loan. This was after trying to top up my Halifax loan but they were not very helpful so I applied online with egg and got an instant decision! Had the money in my bank within 3 days. As I already have an Egg card, they had all of my details so i wasnt asked hardly any questions. My salary and what the loan was for were pretty much the only questions asked! Its was so easy that I wasnt sure I had been accepted! I had to call to check with them!
Another advantage of Egg is that you can top up your payments if you are a bit flush one month. You can clearly see how much you have paid and how much left you have to pay on the 'your money' page on the website. After having trouble with other loans, I cannot recommend Egg enough.
I can thoroughly reccommend Egg Loans. If you are thinking of getting a personal loan, you should definitely look at Egg. Interest: The interest rate on mine is 6.9%, a special offer which won't be valid any longer. I had an existing Egg account. I believe that Egg's interest rates are always competitive. Terms: Egg is commendably transparent and free from small print. You can see the terms of your loan. You can make extra payments or pay off the entire loan whenever you like, with no penalties. Otherwise, your regular payment is taken by direct debit from the account you choose. Application process: is overall remarkably quick and painless. You can apply online at Egg.com, which is quick and painless. You can see clearly what you would be paying over various periods, and amounts, before applying. The Egg customer service people then call you within 2 days - I was called the next day - to ask for further information. This is a little tedious and long winded (for me the call lasted about 15 mins) - but they're paying! The customer service was of a high standard, courteous and pleasant (and not in India!). There was a minimum of stupid/ irrelevant or intrusive questions, and I could see why they asked them. You get a decision there and then. If the loan is approved, you are posted a form - mine arrived quickly and was idiot proof to fill in. You're told when you can expect the money, which was within 4 working days. It was there. General: The Egg website (for anyone new to it) is easy to use. You can view your loan account whenever you like, and see very clearly what you are paying. You don't get paper statements, however you are e-mailed when your payment has gone out. Egg is the best value loan I found, however, Egg is apparently due to be taken over...so who knows what will happen!
If you are thinking of getting a personal loan I can thoroughly recommend Egg as your lender. My colleague just signed up with them to borrow a small sum and I have, as always been thoroughly impressed with both the product and the service. ~~~~ Calculator ~~~~ Before applying for a loan visit the Egg website and head on over to the Loans section. Here you will find a loan calculator to help you decide how much you wish to borrow and over what period. The calculator allows you to enter how much you want to borrow; then either the Period you want to borrow over of the amount of monthly payments you can afford; you can also chose any payment protection options you require. Once you have entered the required information into the calculator you press the calculate button and you are given a loan illustration showing how much you will be paying and the number of payments you need to make. ~~~~ Budget Planner ~~~~ To work out how much you can afford to pay each month for a loan use the budget planner. Here you input details of all your monthly income and all your monthly expenses. To help you remember all your monthly outgoings there is a huge list of commitments that most people have. Simply input in the relevant boxes all your outgoings, the list is really great and includes all the regular utilities (gas, electric etc.) as well as things like holidays and going out and travel to and from work. When you have input all the information press the proceed button and your total spare cash is calculated, helping you to decide just how much you can afford to pay for your loan. ~~~~ Great Rates ~~~ At present Egg are offering the following rates for loans. £1000 to £2499 @ 16.5% APR £2500 to £4999 @ 14.5% APR £5000 to £9999 @ 10.7% APR £10000 to £15000 @ 9.9% APR These are very competitive rates, using Moneyextra.com I did a comparison for the amount he wished to borrow and only 2 lenders offered be
tter interest rates. He chose to go with Egg as they offer more flexibility. ~~~~ Optional loan payment protection ~~~~ Whenever you take out a loan you are offered payment protection. With Egg you can choose the sort of payment protection you require. The options are Accident and sickness Unemployment or death Or any combination of these but life cover cannot be taken on its own. If you choose to protect against unemployment, accident or sickness you can also choose the deferment period (the time before you can claim). The deferment period can be either 30, 90 or 180 days. The amount you will need to pay for your payment protection is calculated according to the options you choose. ~~~~ Payment Breaks ~~~~~ Once you have been making your loan repayments for six months you can take a payment holiday of up to three months. The payment holidays can be taken in any 12 month period. This can be really handy if you find you need extra cash for a short period. After all you never know when you can suddenly get a huge drain on your finances, so you always have the peace of mind that can be gained from the ability to take a payment holiday. ~~~~ Overpayments ~~~~ With an Egg loan you can make an overpayment any time you want. Should you come into some money you can pay off a lump sum. Maybe you'll get lucky and earn a little extra through overtime, you can pay a little extra off of your Egg Loan. ~~~~ No Early Repayment Penalties ~~~~ Should you find yourself in a position to pay off your whole loan, you are able to do so. Some lenders charge an early repayment penalty to make up for the interest they won't get when you pay off your loan early. ~~~~ Interest Calculated Daily ~~~~ This is a huge advantage if you are able to make overpayments to your loan. Instead of being charged interest for a month after you have paid, you are only paying interest on what you ow
e each day. ~~~~ Increase and Decrease Payments ~~~~ As I have already mentioned you can overpay your loan at any time. You can also arrange to make a higher monthly payment permanently if you have got a nice big pay rise. Similarly if your circumstances have left you with a reduced income you can make arrangements to reduce your monthly payments and pay your loan over a longer period. ~~~~~ Online Application ~~~~ You complete all your application details online and you may get a decision within minutes. Egg were in contact the day after the application to confirm a few details and then tell you wether or not your application was successful over the phone. ~~~~ Money In a Week ~~~~ Once your application has been accepted Egg post you the completed forms for you to sign. If you sign and send them straight back your money will be in your nominated bank account within the week. You can also specify a date by which you want the money transferred, this can be up to 3 months away. ~~~~ Choose Your Repayment Date ~~~~ You tell Egg which day of the month you wish them to collect your monthly payments. The collection will commence once you have the money, when your next nominated date comes up. This allows you to make sure the payments are collected just after payday. ~~~~ The bottom Line ~~~~ I helped my colleague to choose Egg because the flexible options are just what he needed at the moment. In the next 18 months he is expecting two payouts which will allow him to pay chunks off of the loan. We found a slightly better rate elsewhere but the flexibility he wanted wasn't there so he went to Egg instead. Also I have Egg shares, which I'm hoping will one day be worth what I paid for them so every bit of business they get helps me!
I recently switched my loan account from Abbey National who were charging 18.9% apr to Egg who are charging just 12%apr. The service I received was excellent - you complete an online application and are given a decision within minutes and the money is in your account within abou 5 days (after you have signed the paperwork) The best thing about it is that along with low interest rates it is also a really flexible loan offering payment breaks and you can pay off lump sums within incurring any charges. I'm now looking at transfering my mortgage as they have really good deals on those too.