Smart borrowing means meeting your monetary needs in an affordable manner. So, when you hit on the personal loan apply online button to meet your financial shortfalls, you must consider the personal loan interest rate. The personal loan rate is an important aspect that dictates your overall affordability concerning your loan repayment journey as it directly impacts your personal loan EMI.
With a lower personal loan rate, you can easily repay your loan proceeds without any stress or hassle. On the contrary, a high personal loan interest rate might propel you to go for a higher loan repayment tenure to keep your personal loan EMI low. However, this option tends to incur a higher interest cost over the loan repayment period. So, ensure to factor in your future financial stability and wellness and pay thorough attention to the rate you are being charged on personal loan. Select a lender offering optimal loan proceeds at the lowest interest rate and processing charges.
Discussed here are ways on how you can avail an affordable personal loan offer –
- Compare among distinct lenders
The initial thing you must do to get an affordable personal loan deal is to perform your own research. Make sure to review the personal loan interest rates of various lenders to choose the best lender according to your suitability and budget.
For selecting an ideal lender, you might also consider using an online personal loan EMI calculator to calculate your personal loan EMI and interest rate according to your budget and cash inflow. Once you have computed your preferred rate and EMI using the calculator, you must negotiate the same with the lenders to get a suitable personal loan deal.
- Maintain a strong credit profile and score
Your credit score may be considered as good if it is 750 and above. A score of 750 and above can help you enhance your eligibility for a personal loan and your chances of getting a lower interest rate owing to your reduced credit risk.
Remember, for a good credit score, you must ensure to follow credit healthy habits. These habits include timely repayment of your credit card and loan dues in full, maintaining a balanced credit mix between secured and unsecured loans, keeping a credit utilisation ratio of within 30 percent, avoiding multiple credit applications in a short time span, and periodically reviewing your credit report to detect any error or mistake. In the case you find any error or mistake in your report, you must instantly report the same to the concerned lender and bureau for quick rectification of the error. Doing so would enhance your credit score automatically, which would indirectly enhance your chances of availing personal loan at a lower interest rate.
- Approach the lender with whom you share a long-term banking relationship
If you hold a good relationship with any lender in the form of a savings account, fixed deposit account, recurring deposit account or credit card account, you might be able to get a reasonable personal loan rate. Keep the interest rate offered by your existing lender as the benchmark to negotiate for a better deal with other lenders. Ensure to go for the one offering the best deal as per your requirement.
Bottom line
A personal loan is the best financial product using which you can meet your urgent financial shortfalls. From funding your child’s higher education or wedding to planning a trip abroad, you can meet all your personal needs with a personal loan with ease. However, while you opt for a personal loan to fulfil your monetary shortages, you must also ensure to pay attention to the offered interest rate and other charges like processing fees, prepayment/foreclosure charges, etc. Doing so would allow you to save on your overall loan cost as well as meet your monthly loan installments in full in a stress-free manner.
