A personal loan comes handy as a financial instrument that can be useful in finding your child’s educational career or a foreign trip with your partner. But well, we all know that personal loans attract higher rates of interest when compared to other loans since they are collateral-free. However, you don’t have to check your horoscope to apply for a low-interest personal loan; all you need is astute financial planning. So given all the constraints, you need to assess the feasibility options of how to secure a personal loan with a lower interest rate. Once you have done that, you can check out the personal loans by Standard Chartered with interest rates starting from the lowest 10.99%, for salaried borrowers working with esteemed organizations.
Smart ways to secure personal loans with low-interest rates
Get the best offers by comparing the lenders:
The market is filled with lucrative offers on personal loans, and the best place is the online financial landscape where you get a chance to select and compare among the various lenders of personal loans. While lower rates of interest might be enticing cross-check the reliability aspect through better communication, identifying the hidden clauses, unstable policies, and shoddy paperwork. Thoroughly compare all the factors and interest rates. Additionally, you can take help from the EMI calculators and score the probable EMIs on the shortlisted loans. Sometimes an existing relationship with a lender might help to get a personal loan at a comparatively lower interest rate.
Building a good credit score:
Your creditworthiness is reflected through the credit scores that are based on how you have managed your credit in the past. A personal loan is an unsecured loan, and hence a credit score of 750 and above is desirable. The higher the scores, the better are the chances to get your loans sanctioned. It also helps you to negotiate various terms like tenure, interest rates, and loan amounts.
If your ratings are poor then here are some of the ways to improve it by maintaining your credit utilization ratio at 30 percent, a balanced credit mix of both secured and unsecured loans and lastly, reviewing your credit rates at regular intervals. Furthermore, if you have applied for a personal loan with a guarantor or co-applicant, it is becoming equally important to know whether they have made their timely payment since a delayed or missed payment will adversely hamper your credit scores along with the scores of the guarantor or co-applicant.
Your salary package and reputation of your organization evaluate your credibility in the eye of a lender. A good package in a reliable company will make your job more stable, and as a borrower, this will also help you to make the repayments in time. You can use this even as a benefit and adjust terms with the lender to get a personal loan at a lower rate. Besides, if your employer has a good relationship with a lending institution, then there are special provisions for the employees to get some discounts on a personal loan.
Calculating interest rates:
Despite securing a personal loan at a lower interest rate, it might happen that you end up paying more interest rates at the end of the loan tenure. This is because the calculation procedures of interest rates are different for different lending institutions. Suppose, if a lender offers you a flat interest rate, then the interest rate will be computed on the total loan amount. On the contrary to this, a reducing rate of interest is beneficial in terms like the interest rate is calculated on the outstanding principal amount, which will automatically decrease the principal through the EMI payments. This will eventually cost you less, and therefore, it is better to understand the entire concept of interest calculation before finalizing your loan application.
Look for seasonal offers to get the best deals:
During festive seasons many banks and NBFCs offer attractive interest rates and schemes on personal loans. Some of the lenders can even notify you by sending emails and messages. Well, you can also check the online market platform to know better regarding these offers and schemes. Through such offers now you can avail of a personal loan at a much affordable interest rate. More often, these offers are at one’s disposal if they submit an online application. So you can get it during the festive seasons as this will help you to cut down your interest rate to a greater extent.
So before zeroing on any lender, it is better to weigh all the pros and cons like pre-payment fees, processing fees, loan amount, tenure, etc of a personal loan. A reasonable interest rate is significant, but it should be coupled with these factors. CIBIL score with 700 or more is perfect if you wish to sanction your personal loan at a lower interest rate.