Introduction
A personal loan is one of the most sought-after options for funding an immediate financial contingency. From financing your business or wedding to paying for medical or educational expenses, the loan amount can be used for just about any purpose. In contrary to the traditional loan process that is tedious and cumbersome, applying for a personal loan is convenient and hassle-free. Online individual loan appshave transformed the loan application process into a matter of a few clicks on any internet supporting device. An online loan app offers an entirely digital experience with the loan application process concluded within a few minutes and the amount disbursed within a few hours upon approval. However, it is crucial to avail a personal loan at a competitive interest rate to ensure ease in repayment.
Mentioned below are a few tips to avail of lower interest rates on personal loans.
- Maintain a good credit score:
The credit score is a numerical representation of an individual’s creditworthiness and credit history. A high credit score implies that one is a reliable borrower at a lower risk of default. Responsible credit behavior will put you at an advantage to avail of your preferred tenure and interest rate. The credit score is a crucial criterion while assessing an individual’s loan eligibility, loan sanction amount, interest rate, and other loan terms. It also plays an integral role in the loan approval process by facilitating faster approval upon application. Maintaining a high credit score puts you in a better position to negotiate the available rates and avail a lower interest rate on instant personal loans. Making timely repayments can help you maintain a good credit history. Any credit score above 750 is considered ideal. You can check your credit score for free on an online personal loan app and make improvements accordingly.
- Maintain a good repayment history:
An impeccable repayment record gives you the upper hand while negotiating the interest rates with the lender. Maintaining a good repayment track record is vital to achieving a high credit score. It is crucial to pay attention to the payment due dates to clear all bills in time and in full to avoid unwanted penalties. Defaulting on EMIs and credit card repayments can impact your credit score negatively.
- Avoid multiple loan applications at the same time:
Lenders view you as a high-risk candidate with a greater risk of defaulting if you make several loan inquiries within a short time. In addition, too many loan applications at the same time might significantly bring down your credit rating, making it difficult for you to avail of a personal loan at a lower interest rate.
- Compare interest rates:
You can easily compare and analyze the interest rates and loan offer by various lenders with the help of an online loan app. Conducting thorough research will help you assess features such as loan tenure, processing fee, and repayment terms to weigh your options before zeroing in on one that fits your requirements best. With the help of an EMI calculator on an online loan app, you can evaluate your eligibility for various offers and plan your loan proficiently.
5. Look out for seasonal offers:
Many online personal loan apps launch attractive, limited-period seasonal discounts commonly during the festive season. Availing of an instant loan during this period can prove to be a cost-effective option. It enables you to avail of an instant loan at an interest rate much lower than the usual rate offered during the remaining year.
Conclusion
Since personal loans are not supported by collateral or security guarantees, the interest rates on such loans are generally higher. Therefore, it is crucial to avail of a personal loan at a lower interest rate. You can secure an instant personal loan at a competitive interest rate and enjoy easy approval of your loan application by employing these tips. An online personal loan app can help you grab a personal loan at an attractive interest rate, low processing fees, flexible repayment terms, and a flexible tenure. Conscious effort to maintain good credit behavior and clean credit history is imperative to ensure approval of your loan application and secure lower interest rates.