It seems that almost every time you open your email inbox, another flood of messages arrives congratulating you for qualifying for a specially discounted rate for a loan. After wading your way through these messages, you then find that scattered liberally throughout the web pages you visit are yet more adverts for cheap loans that exactly fit your specific circumstances.

With so much apparent choice and variety, it can become overwhelming, and identifying which would be the best option for your individual circumstances can be a very difficult task.

There will, naturally, be a variety of reasons why you will be eligible for different rates and terms. Your employment and credit history, whether you own property and the time scale for repayment will all make a significant difference.

A major influence on the interest rates and terms available to you will be the period of time over which you wish to pay off the loan, and also how quickly you need access to the funds in the first place. If urgency is an issue, then many people opt for the 'pay day' loan format, which is where a reasonably small amount of money is lent, often just until the end of the month, or whenever you next get paid. The interest rate is often high, but if paid off on time, doesn't last long enough to accrue too much to become a long term issue of concern.

However, the most competitive rates on the market will be for loans which are secured, usually on property. These gives the lender the reassurance of knowing that their money is reasonably safe, and that should all else fail, they have a good chance of receiving most, if not all, of the funds back. As a result, these companies will be extremely competitive, and provide far better terms.

In order to find the cheapest loans available, ideally you should be in well paid, full time employment, with a good credit history and property against which the loan can be secured. If you are fortunate enough to be in this situation, then you would be wise to shop around, since you will be considered a very safe borrower, and lenders will be very keen to attract your attention.

There is an increasing market today, though, for borrowers who do not fit this idealistic profile. As a result, companies are addressing their needs by offering alternative packages, which generally compare far less favourably, but between themselves, can still vary fairly significantly. Sadly, in many cases, the very people who would benefit most from spending time shopping around for the best deal on a loan are in need of the funds too rapidly to spend time doing the research first.

Indeed, often it is the case that the borrower is so relieved to find someone who will lend at all, that they take the first offer made. What may seem like a good deal at the time could result in being committed to paying a far higher rate of interest than was necessary, and paying far more in the long term than if they had spent more time shopping around to compare deals.