How to get better Interest rates on Personal Loan
A personal loan is a simple short-term loan which could be used for any legitimate purpose. You won't be required to pledge any form of collateral or security. It can be used to meet immediate personal expenses which could be anything – a medical emergency, sudden loss of job, to fund a wedding or higher studies, or used as capital for business or even to consolidate debt.
Advantages of a personal loan
A personal loan has several advantages including relatively simple documentation, no need for collateral, and no restrictions on how to use the money.
However, there is a downside to a personal loan – it is one of the costliest loans in the market as it comes with high-interest rates. This can be attributed to the fact it is an unsecured loan and the lender charges high-interest rates because they want to safeguard their money against potential default. The interest rate on personal loan stars from 11% and could go anywhere up to 30% or even more depend on your individual credit profile.
So, how do you get better interest rates on a personal loan?
1. The most important factor that will help you land a personal loan at the lowest interest rate possible is your credit score. If you have a bad credit score, consider taking out time to fix your credit score.
2. Concentrate on lowering your debt-to-income ratio.
3. Keep your credit utilization low – well under 50% of your overall limit.
4. Only apply for credit when absolutely required.
How to apply for a personal loan with the lowest interest rate?
You can check your eligibility and apply for a personal loan by signing up with CreditMantri. It is quick, simple and above all, free.
CreditMantri matches your credit and demographic profile to the lender's lending criteria and presents you a shortlist of only those lenders willing to lend to you based on your unique credit profile. In effect, we pre-screen your application to make sure you are likely to qualify as per the lender's credit criteria. Hence, the chances of your personal loan application getting approved are higher. You will also be able to compare and contrast the interest rates offered by different lenders and hence, be able to make an informed decision.
Click here to sign up and apply for loans and credit cards, the CreditMantri way!