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Explained: Tips to lower your personal loan interest rates in India

 

The standards of living in India have changed over the years. People of today’s times are no longer contended with fulfilling the basic necessities of life. They want to explore new places and wear the latest fashion; however, increasing inflation rates and the minimum amount of salary stops them from doing so. Thus, at such times, they often end up in bad debt and financial mismanagement. However, now there are a number of banks and FINTECH companies that provide people with an instant personal loan; thus, people can not only make use of the money to consolidate their existing debts but also to improve their standards of living.

However, even though, financial institutions provide a personal form of loans at way lower interest rates than the traditional financiers; but many of us still want to subdue them further. Thus, we have compiled a list of few tips that will help you lower your personal loan interest rates in India, and

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They are here as follows:

  • Comparison: The first thing that you need to do is compare the interest rates charged by the financial institution; after all, every lender’s interest rates differ from one another. Thus, if you compare, there are chances that you might find an instant personal loan at a lower interest rate from another lender. You can make use of an EMI calculator for that. The financial institutions provide you with an EMI calculator on their online websites; thus, you can easily make use of this tool to compare and find financial assistance at the lowest possible interest rates. An EMI calculator helps you to compare personal loans on the basis of the principal amount borrowed, interest rates charged by the financial institutions and the repayment tenure opted by you.
  • Credit score and history: Your credit score and history is the reflection of your financial behavior and management. Thus, if you have a good credit score; generally above 700, then you are not only eligible for a personal loan but you can even renegotiate on the interest rates. Thus, ensure that you make timely repayments on all of your previous as well as current debts. The reason why financial institutions scrutinize your credit score and history is that; a personal form of loan is unsecured in nature and thus, you don’t have to submit any sort of collateral to make use of it. Hence, financial institutions check your credit score and history to gauge your previous repayments and determine the risk-factor involved in lending you monetary assistance.
  • Employment and income: The financial institutions also check your income source and job stability to determine your personal loan interest rates in India. The reason being; if your employer has a good reputation in the market then it will affect your job stability in a good way. Further, if you have spent a considerate amount of time at your current place of employment (say, 2 years), then you will easily obtain an unsecured loan and that too, at lower interest rates.

 

Hope this article helps you to understand the tips that will lower your interest rates. Good luck and all the best!