By Jennifer Hill

LONDON (Reuters) - Personal loan rates have increased by up to 4 percent as the credit crunch and rising bad debts take their toll.

At least nine lenders have hiked rates on unsecured personal loans since the start of last week, as lenders respond to volatility in capital markets and higher perceived risk among borrowers.

"With increasing uncertainty in the financial markets, rising levels of bad debt and a year of interest rate rises putting pressure on our disposable incomes, it comes as no surprise to see lenders increasing their lending margins ..," says Lisa Taylor, an analyst at price comparison service Moneyfacts.co.uk.

Bradford & Bingley (B&B) raised its loan rates by up to 4 percent on Monday, giving a rate of 17.9 percent on loans of between 2,000 and 2,950 pounds.

The Cheshire and Derbyshire building societies lifted theirs by up to 3 percent, also to a maximum of 17.9 percent on small sums borrowed.

Goldfish lifted its loan rates by up to 1 percent from Tuesday, Norwich Union and RAC Financial Services pushed through the same increase a day earlier, while Eskimo Loans increased its rates by 1 percent a week before.

Norwich & Peterborough Building Society raised its rates by up to 0.70 percent last Monday, while Northern Rock -- the bank left struggling to stay afloat in the wake of the global credit crunch -- has also upped its loan rates, by 0.50 percent.

The increases have added up to 300 pounds to the cost of a 5,000 pound loan taken out over 36 months with B&B, and created a 500 pound gap between the cheapest and most expensive deals, according to Moneyfacts.