A personal loan is a great way to finance one’s personal financial needs. People commonly opt for personal loans to pay for higher studies, to finance marriages and even to go for vacations. A personal loan is extremely handy and it’s easily available too. However, since it is unsecured, the personal loan interest rates in India may be higher. The good news here is that some tips can be used to lower the personal loan interest rates. Let’s find out more!
Benefits of Personal Loan
Before we discover how to lower the personal loan interest rate, let’s explore the benefits you get when you opt for this form of personal financing:
- Simple application process
These days, to apply for a personal loan, all you have to do is go online, fill up a simple form, upload e-copies of your documents and submit your application. The process is smooth and straightforward.
- Quick loan disbursal
If approved, the loan amount will reach your bank account in less than two working days; this is a huge benefit, especially if you need the funds urgently.
- No restriction on usage
Once you receive the loan, you are free to use it in any way you wish. Your lender won’t impose any restrictions on the usage.
Tips to Reduce Personal Loan Interest Rates
Follow these simple tips to get your personal loan at a lower rate:
- Pre-approved loans
Many lenders offer pre-approved loans; these are given to select customers who have a good financial profile. Check the eligibility criteria and opt for a pre-approved loan to get the personal loan at a lower rate of interest.
- Maintain a good credit score
A borrower who has a healthy credit score always gets a personal loan at a lower rate of interest. Maintain a good credit score at all times to get this benefit. Use a personal loan EMI calculator to check the EMIs and you will be able to find an affordable option.
It is always a good idea to negotiate when taking a personal loan. Do not agree to the interest rate your lender offers. Rather, negotiate and try to lower it.
- Opt for a short-term loan
Since a shorter loan tenure would mean paying fewer personal loan EMI, you will end up paying lesser interest in the long run; this is another effective way in which you can lower your interest liability when taking a personal loan.
Keep these tips in mind to acquire the best interest rate on your personal loan!
The Bottom Line
Whether you need to pay for your own wedding or you want to buy a car, opt for a personal loan for its many benefits. Negotiate with the lender and try to lower the rate of interest on the personal loan as this will make it more economical for you. Take the loan from a trusted lender such as renowned banks and enjoy several benefits.