Looking for personal loans? Some smart tips save on the interest payable.
Posted: Jan 12, 2019
Personal loans are easily one of the best funding options to turn to when you need to bridge any financial gaps. They provide decent loan amounts quickly and conveniently and at affordable rates.
However, if you wish to reduce the overall interest amount payable towards such a loan, you can use the following tips to avail lowered rates.
Your Credit score:
It is pretty obvious that if you have a good credit score to your name, the chances of getting lower rate of interest is high. A loan lender would offer such consideration as a person has good credit history to profound their legibility. And in case if you don’t have a great credit score, you can improve it easily and steadily over time. To do so, you can also keep your credit card balance low and make all the payments on the time, which will eventually boost your credit score.
Do some research!
You can’t just throw a dart at the first loan lender you see online and proceed to apply for a personal loan. It might take some time, but do consider scrolling through some apna loan personal loans profiles to get the best for you. Most loan lenders in market have their EMI calculators on their sites, which can be useful tool to compare two or more loan products. You can get personalized rate of interest as per your credit score.
Compare Annual Percentage Rates!
While most aspirants tend to pit rate of interest while comparing personal loan, you should also focus on Annual percentage rate (APR). It defines the true cost of a personal loan as it includes the interest and the processing fee charged by the loan lender. You can evaluate such rates on the product brochures or the official sites to get APR value on each personal loan products.
Benefits of short tenure period:Although most people would prefer to choose a longer tenure period on loan repayments as the EMIs are became more manageable. However, you could also opt for shorter tenures, if your financial strength allows, and enjoy substantially lower interest amounts. This is because, when you opt for shorter tenures, you pay interest for fewer months resulting in a smaller interest amount.
Some lenders will offer you a slightly lower rate if you provide some security against your loan. This is because, after doing so, you are less of a risk to the lender and even if you default in the loan, they will still be able to recover some amount of their loss by doing-away with your collateral.
Add a co-applicant.
The risk you pose to lenders goes a long way in deciding the interest rate applicable on your loan. Therefore, when you add a co-applicant, especially one with a strong credit history, you are much less of risk to the lender and this could bring down your rate. Therefore, if you have someone you can co-borrow the loan with, it makes sense to apply jointly and enquire with lenders if they will provide you lower rates.
We hope these tips will help you enjoy lower rates and help you save loads of money on personal loans. For guidance or clarity on any of these tips, feel free to reach out to one of the many lenders – they will be more than happy to answer any of your doubts.
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