A personal loan is an unsecured loan that can help you meet your financial needs. You can use the loan amount for various purposes like a wedding, higher education, debt consolidation, home renovation, travel plans, etc. However, you need to repay the loan amount timely with its interest component. The interest rate of a personal loan is a significant determinant of the total loan amount. Your EMI and the total repayment amount are determined by the interest rate charged on the personal loan. Therefore, you must strive to get the best and lowest interest rate. But how? If you are wondering the same, here are some amazing tricks to help you get affordable interest rates on your loan.
- Maintain a high credit score
Your credit score is the first thing that the lender considers when you apply for a personal loan. With the help of your credit score, they can gauge your creditworthiness and repayment capability. Typically, lenders can reject the application if you have a low credit score. However, many lenders do approve the application with a low credit score but offer high-interest rates. To get an affordable interest rate, maintain a high credit score. It would help if you take steps to boost your credit score. Also, do ensure that you repay the loan EMIs and credit card dues on time and in full.
- Use your banking relationship
Having a good banking relationship can help you get a low-interest rate on your personal loan. It would be best to open a bank account first or maybe open a fixed deposit. Managing these two can assure the lender of your creditworthiness and help you get an affordable interest rate.
- Choose your lender carefully
Every lender offers different interest rates. Research well before you opt for a personal loan. You can look for lenders that offer the lowest personal loan interest rate. But that should not be the only criteria for selection. You must also consider other factors like processing fee, customer services, application process etc. Choose a lender that helps you avail a loan in a hassle-free way.
- Look for seasonal offers
Lenders often launch seasonal offers and schemes to attract customers. Typically launched during the festive season, you can get loans at affordable interest rates during such offers. You can get to know about the offers through the emails and messages sent by the bank.
- Associate with a credible employer
Getting employed by a credible employer can help you get affordable interest rates. Typically, applicants working with multinational companies, government companies, public companies and reputed private companies get favourable deals as they have better surety of steady and regular income. Lenders assume that such employees have a high income and less chances of making defaults.
Before you avail a personal loan, ensure that you read the fine print carefully and be aware of the loan terms. Also, you must not apply for a personal loan with several lenders as it can reduce your credit score and chances of approval.