Instant personal loans are a great weapon to fight against any financial obligations. They are unsecured which means no need to pledge any assets to avail of a loan which makes them a popular choice among millennials. But due to their collateral-free feature, personal loans come with a high-interest rate. Thus, the interest rate on personal loans is a crucial factor to consider.
The rate of interest on a quick personal loan is the interest rate at which the lender approves the loan application. The higher the rate of interest, the higher will be the loan cost resulting in higher monthly EMI. Personal loans are provided by multiple banks and non-banking financial institutions. Lenders offer attractive benefits to the borrowers and interest rate is the major one that people mostly focus on.
Factors that impact personal loan interest rates are –
- Credit Score
- Your age
- Employment type
- Your financial profile
- Annual income
Thus, if you have a good credit profile and stability in your work life, then you may get a lower interest rate on personal loans.
Factors That Affect Personal Loan Interest Rates
Check out the below factors that affect your loan interest rate –
- Credit Score: This is the foremost aspect to consider. Your credit score indicates your creditworthiness. So, always maintain a good credit score by repaying your existing loans and credit bills timely. A credit score above 750 is always considered good. The higher the credit score, the greater are the chances of getting a personal loan approved at the lowest rate of interest.
- Income: Having a good income assures a lender whether you are capable of repaying your loan on time or not. Therefore, make sure you have a stable income before proceeding with your loan application.
- Employment: People with a good job profile and consistent income let you enjoy low interest on personal loans.
- Stop Applying With Multiple Lenders: Do not apply for a loan with multiple lenders as each loan inquiry reflects in your credit report while affecting the credit score. And because of this, you may not receive a good deal on your personal loan.
- Maintain Good Relationship: Maintaining a good relationship with your existing lender may help you to get a lower interest rate in your future loan application.
Top 10 Bank Loans With Interest Rates – 2022
|Bank Name||Interest Rate|
|State Bank of India||9.60% Onwards|
|Central Bank of India||8.45% Onwards|
|Union Bank of India||8.90% Onwards|
|Punjab National Bank||8.95% Onwards|
|Indian Bank||9.05% Onwards|
|Bank of India||9.35% Onwards|
|IDBI Bank||9.50% Onwards|
|Bank of Maharashtra||9.55% Onwards|
|UCO Bank||8.45% Onwards|
|HSBC Bank||9.75% Onwards|
Follow the below points to get a low-interest rate on the personal loan,
- Maintain a high credit score to enable a low-interest personal loan. Don’t miss your repayments, pay them on time to increase the chances of low-interest personal loan approval.
- Before proceeding with your loan application, make sure you compare loan interest rates offered by different lenders. This simple practice will help you to get a low interest on your personal loan.
- Check with the existing lenders, might be a good relationship with them can help you enjoy a low-interest personal loan.
- Most lenders often offer attractive deals and offer for their valuable borrowers. So keep an eye on those deals to avail low-interest rates.
On a note, interest rates on personal loans may vary among the lenders, so keep an eye on the offers, do a comparative analysis before processing the application, maintain a good credit score, and avail a low-interest loan to meet all the financial needs with ease and convenience!
How To Achieve Lower Interest Rate on Personal Loans?
Personal loans are a great financing option to meet any unexpected expenses from medical emergencies to unforeseen debt consolidation requirements, wedding expenditure, higher education, dream vacation, and many more. Instant loans are gaining popularity because of the simple online application process, minimal documentation & ease of availability.
It is always suggested to check your monthly budget and other expenses before availing of a personal loan. In this way, you can maintain a monthly smooth cash flow without disrupting your budget. However, in recent times, most borrowers look for a low-interest rate on the personal loan. Low-interest rate makes it easier to manage all the expenditures without creating any bias.
There is no doubt that personal loans play a crucial role in fulfilling all the financial needs of an individual, no matter how big or small the expense is. And availing of a low interest will be an added advantage. Low-interest personal loans not only save your money but also make repayments with ease. Thinking about how to avail low-interest rates on personal loans? Read on to find the best ways to get the best rate on quick loans.
Maintain a Good Credit Score:
Your credit report displays your creditworthiness. A score above 750 is considered to be good and makes an individual avail of a loan quickly without any hassle. The better the credit score, the easier it is to get a low-interest rate on personal loans. Based on your credit score, lenders decide your loan amount, interest & repayment tenure. A higher score allows you to negotiate better on interest.
Make a Comparison Between Lenders:
Depending on your loan eligibility and requirements, consider comparing various personal loan lenders. There are many lenders available in the current financial market, offering multiple offers and features. Spending some time on proper research will save your money while letting you enjoy the best personal loan plan at competitive interest rates. Find a lender who offers loans at the best interest and also don’t forget to compare the benefits. You may find the process a little difficult, but the decision will be worth it. You can also use a personal loan eligibility calculator to get detailed information.
Check For Various Loan Offers:
Most of the lenders notify about their special offers and deals calls, SMS & emails. This offer includes repayment tenure, interest rate, and many more. Being a borrower, you need to have a look at all these exciting deals in order to gain a low-interest rate on personal loans. Such offers are limited, so grab them before they end.
Professional Qualification Can Decide Your Loan Interest Rate
There are many lenders who provide a personal loan based on your work experience and income. If your work profile is strong and withdrawing a good amount, then you may enjoy a low interest on instant loans.
There can be multiple ways to achieve a reduced interest rate. Besides the above-mentioned tips, you can have a discussion with financial experts. In this way, you can gain a proper understanding of personal loan interest rates and choose the best that will match your requirement. At Buddy Loan, you can avail a loan up to Rs. 15 Lakhs as per your needs and profile at a low interest starting from 11% p.a. Apply now & get the best deal to meet all the financial needs with ease and ultimate convenience.