An unexpected financial emergency can befall upon anyone at any given time. And at such times, you may face a shortage of funds to relieve those exigencies. However, now thanks to the personal loans offered by the new-age financial institutions, you can easily take care of your problems, without asking for help from friends and family. Therefore, today in this article, we will be sharing 5 tips that will help you reduce your personal loan interest rate in India, and they are here as follows:
· Compare to choose the best: In recent years, there are a ton of financial institutions that provide the services of a personal loan in India. Further, each and every lender’s interest rate differs from one another. Thus, you get the option to compare and find the financial institution that provides you with the best loan product at the lowest possible rate of interest. The new-age banks and NBFCs (non-banking financial companies) even provide you with online tools such as an EMI calculator on their websites for free-of-cost; hence, you can make use of this tool to calculate your installments on the basis of principal borrowed amount, interest rates charged by the financial institutions and the repayment tenure opted by you. You can even choose to compare loan products on the aggregator websites available in the market.
· Repayment tenure options: The new-age financial institutions offer a personal loan with flexible repayment options, in the form of EMIs (equated monthly installments). This greatly helps you to compute and plan out your current and future repayments easily. Further, you can even make use of an EMI calculator. However, even though, long repayment tenure reduces the burden of payments by offering lower EMIs; however, at the same time, you have to shell out higher personal loan interest rate for the same. But you can always choose to opt for a shorter term with a lower interest rate.
· Work on your credit score: Your credit score is the perfect reflection of your previous and current repayments. Further, a good credit score also encourages financial institutions to sanction your loan application. However, did you know that having a good credit score will also help you to reduce your interest rates? If you didn’t, then the answer is ‘yes’ it does. Thus, you can easily work on your credit score to ensure that you obtain financial assistance with lower personal loan interest rate.
· Choose to foreclose your loan: Although, the best thing about opting for a personal form of loan is the flexible repayment tenure; however, as we have already discussed, it also increases your interest rates. However, there are a lot of banks and NBFCs (non-banking financial companies) that provide you with the option to foreclose your account for minimum dues, or many-a-time for free. And even if you do have to pay a certain amount of foreclosure fees, it will be way lower than the personal loan interest rate that you will be paying. Thus, opting for a personal loan interest rate will help you to reduce your overall rate of interest for the loan amount.