Everyone wishes to spend the money according to their will, without ever worrying about the money they would end up having it in their bank accounts. Thus, we try in every possible way to avoid any financial hardships in life.
We try very hard to evade any financial contingencies that generally affect our lives, but sometimes, these situations are inevitable. It might be due to some unforeseen expenses that might have stretched up suddenly or might be because of long term wishes that we wanted to fulfill. In such a situation, personal loans are the handiest option, but make sure that you avail them at a low rate of interest.
A personal loan is one of the most attractive financial products due to the variety of benefits they offer to the borrowers. In India, there are personal loans offered by almost every financial institution at very competitive rates. Personal Loans are an unsecured form of lending as there is no collateral provided to the banks in exchange for the loan. Along with this, you are offered complete freedom to use the loan amount as per your needs without looking for the bank's consent.
The tenure of a personal loan repayment ranges from 6 months to 60 months, and the amount that can be availed can go maximum to Rs 50 Lakhs. To meet the immediate financial responsibilities without clearing out your entire savings, you can go for the personal loan. Personal loans do not allow any unnecessary pressure on your finances as repayment can be made in the form of EMIs (Equated Monthly Instalments).
You need to keep in mind that Personal Loans are available for salaried, self-employed, and sole proprietors only. There are several options available to get a personal loan. Thus, compare all the different options online before you apply for a personal loan.
Getting a low-interest personal loan can be a complicated task if you don’t follow the proper research method before availing a loan. Here are three crucial tips to help you avail low-interest rate personal loans making your task easy:
1) Keep a check on your credit score
The better your credit score is, the more are your chances to the personal loan at a lower rate of interest. Most lenders will not even process your application if your credit score is not according to their threshold. Therefore, you must maintain a credit score of more than 700; this would not only enhance your eligibility for a loan, it would also ensure that you get the lowest interest rates from the lenders.
It acts as a guarantee for banks as it proves you to be a creditworthy person and thus reduces the chance of risk in default in repayment.
2) Have a stable income
While applying for a personal loan, you must take the lender in confidence about your stable professional life. The bank would then consider you as a prospective customer who would pay the EMIs on time and quickly agree to offer you a low rate of interest on the loan you have applied for since there is a lot of competition among banks these days. Although there is a condition, you must be working at your present job for at least two years to be eligible for a Personal Loan. If you regularly change your job, the banks might not consider it as a good factor.
3) Owning your assets
In case you own a house or any other fixed capital asset in your name, it makes lenders trust you even though there is no mortgage needed in a personal loan. It helps lender judge the chances of defaulting or running away are almost negligible, and they form a trust on you, which can help you get a personal loan at a low rate of interest.