Do you want to travel abroad, pay medical bills, or fund your wedding? You can take quick personal loans in India for such purposes.
After taking the loan, you must repay it in equated monthly installments (EMIs) consisting of the principal amount and interest. Since your EMI amount largely depends on the interest rate charged by the loan provider, you should always check the prevailing interest rates.
Getting a personal loan with lower interest rates reduces the cost of your loan. Therefore, you should find out how to get a low-interest rate Personal Loan before applying.
Furthermore, you should check your financial needs and determine your needed amount. You can then use the online calculator for personal loan, available on the website of leading NBFCs, to check the interest payable as per chosen loan term. That way, you can know your EMIs and plan your budget accordingly before applying for a personal loan.
Here are several tips to secure a low-interest rate personal loan.
5 Ways to Get a Low-Interest Rate On personal loan
Make Comparisons on Loan Offerings
After assessing your need, consider the interest rates, lending conditions, loan tenure, and loan features of different loan products. Finalise the one best suit your need.
While you may have to negotiate for a low-interest rate personal loan when applying through the offline mode, you may prefer to apply for a personal loan online. An online application eliminates intermediaries and helps you get a personal loan at low-interest rates.
So, although it is wise to apply online, researching beforehand can help you get the best interest rate.
Boost Your Credit Score before Applying
Every financial institution checks your ability to repay before approving your loan. Your credit score helps to gauge your loan repayment ability. A credit score ranges from 300 up to 900.
A higher credit score gives your lending institution confidence that you can repay your loan without defaulting. In addition, you can negotiate with your financial institution for a low-interest rate personal loan.
At Clix Capital, you can get a personal loan at attractive interest rates with an Experian credit score of 630 and above.
Is your credit score below 630? You can work to improve it by clearing existing loans on time. If your credit score has some errors, you can apply for error corrections, which raises your score.
Sign-up for a Shorter Repayment Period
A personal loan with a shorter repayment period comes with lower interest rates. However, consider getting a short-term personal loan only if you can afford to pay bigger EMIs.
When you sign-up for a short-term loan, you reduce the cost of your loan. In contrast, the payable interest will be higher for a long-term personal loan.
You can use a personal loan interest rate to determine EMI and repayment period before you apply for a loan.
Have a Clear Purpose for Your Loan
You don’t have to provide collateral when applying for a personal loan. Also, no one will limit or direct you on how to spend your loan amount. But personal loans carry some degree of risk. So, many financial institutions charge interest rates depending on the level of risk.
If you need the loan for an emergency, you may not have time to negotiate the interest rate, but when you require the loan for non-emergency needs, you can always negotiate for lower interest rates.
So, a clear loan purpose can help you get the best interest rate.
Disclose Other Sources of Income
What’s your disposable income? Can you repay the EMIs without defaulting? Your income can provide the answers to such questions. So, you should disclose all your income sources while applying for the loan.
Remember, you can get a personal loan at lower interest rates when your ability to repay is higher; it all depends on your income.
Summing It Up
Low-interest rate makes personal loans less costly. Use the tips in this article to learn how to get a low-interest-rate personal loan. Ensure you disclose all your sources of income when applying for a personal loan. Also, research online to get a loan with low-interest rates.