Rate Drop

Rate Drop, unsecured personal loans in the United Kingdom

Rate Drop is a trading name of Credit Labs Limited, a company registered in the United Kingdom with number 8387053 and registered office at 1st Floor Yorkshire House, 18 Chapel Street, Liverpool, L3 9AG. The entity is authorised and regulated by the Financial Conduct Authority with reference number 717767 and is registered with the Information Commissioner's Office under number Z3574423. Rate Drop and 1Plus1 Loans are trading names of Credit Labs Limited, which has been operating since 2013.

The business consists of direct lending of unsecured personal loans, not brokerage. Available amounts range from £1,000 to £5,000, with terms presented on the website between 12 and 60 months, and a maximum annual rate of 39.9% (variable). The site states that applications are handled online and that some approved customers receive funds on the same day as the application, provided the required verifications are completed.

Rate Drop Technology: automatic rate reduction

The distinctive feature of the product is the system the company calls Rate Drop Technology. All customers start at the same fixed rate, with no tiers or price differentials based on profile. After six consecutive monthly payments made on time, the rate is reduced automatically and the monthly repayment decreases accordingly. For loans longer than 12 months, a second reduction may be applied during the life of the contract. The company states that this mechanism does not require refinancing or a new application.

According to data published on the site, the initial rate is 39.9% APR; after the first six on-time payments it drops to 37.2% APR and, after another six consecutive on-time payments, a final reduction to 34.5% APR is applied. The company emphasises that it does not apply hidden fees or application charges.

Representative example and published conditions

The representative example on the website corresponds to a loan of £3,000 over 36 months, with an annual interest rate of 34.05% and a representative APR of 39.9% (variable). The resulting monthly repayment is £134.10, the total cost of credit amounts to £1,827.60 and the total amount payable is £4,827.60.

To apply for a loan with rate reduction, applicants must be between 18 and 69 years old and employed, as self-employment is excluded. The company initially performs a credit check with no impact on credit history. Approval is subject to meeting affordability, credit risk and verification criteria, so not all applications are accepted.

Affordability assessment and application process

The entity describes an analysis process based on actual ability to pay throughout the entire term, not just the first instalment. To verify income and expenses, it works with banks and uses Open Banking, which allows it to review bank statements and make decisions it presents as fair and responsible. The stated goal is for applicants to cover their essential expenses, be able to meet the monthly repayment and retain a margin for unforeseen events.

Communication with the customer begins before signing: the company explains the conditions to the applicant and, where applicable, also to their guarantor, so that both parties understand their obligations and risks. The team processes payments quickly, often on the same day, according to the information on the site.

Typical uses of the loan

The website notes that loans are used for various purposes, from unexpected expenses to larger planned purchases. Among the most common uses, it mentions debt consolidation, which combines several payments into a single monthly repayment, home improvements and buying a car. In these cases, no deposit or balloon payment is required. The company warns that consolidating debt may lengthen the repayment term and increase the total amount paid.

Warnings and responsible lending framework

Rate Drop presents itself as a responsible lender and reminds that an unsecured loan may not be suitable for all profiles. Before taking out a loan, it recommends assessing whether the product fits the personal situation and warns that a change in financial circumstances may make repayment difficult. Missed payments can result in additional charges, damage credit history and make future financing more expensive or difficult. The entity also indicates that this loan may not be appropriate for those experiencing financial difficulties or who could access lower-cost credit.

Ratings and customer service

The site shows an average rating of 4.9 out of 5 based on 42 verified reviews from an independent review service. The company maintains specific channels for payments and complaints, as well as a general contact address, and publishes customer service hours Monday to Friday from 9:00 to 18:00.

Location and contact

1st Floor Yorkshire House, 18 Chapel Street, Liverpool, L3 9AG