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05 JANUARY, 2023
Features like collateral-free, quick disbursal, and zero restriction on the usage of proceeds are the reasons why personal loans tend to be a popular choice to meet monetary shortfalls instantly. However, as the loan is unsecured in nature, the personal loan rate generally is on the higher end than secured loan options. This disparity in rates is owing to different personal loan eligibility parameters factored in by a lender when assessing your application for a personal loan. Read on to know the four strategies to obtain the lowest personal loan rate.
1. Maintain an excellent credit score
A credit score is a three-digit number that indicates your credibility as a borrower. A credit score of 750 and above is looked upon as a good score. Lenders look at your score to evaluate your credit history, past repayment behaviour, and existing financial obligations. If your previously availed loans have been repaid in a timely way, the lender may consider you a low-risk applicant. This confidence in you allows the lender to offer you a low personal loan rate.
2. Compare various lenders
Every lender provides a personal loan at distinct rates. Thus, before you hit on any personal loan apply button for instant loan proceeds, you must ensure to compare the different personal loan interest rates. Doing this may allow you to find a loan offer at a low rate of interest as per your preference.
3. Watch out for seasonal offers
Make sure to look out for seasonal offers provided. A lot of times, festive and seasonal offers on interest rates and processing charges are offered for personal loans. Availing such an offer on a personal loan may allow you to considerably reduce your overall interest constituent.
4. Use an online personal loan EMI calculator
You can use Kotak’s online personal loan calculator to compute your Equated Monthly Instalment (EMI) and overall interest outgo. Here in this calculator, you must input three major parameters, namely – personal loan rate, required loan amount, and preferred repayment tenure. Once you input these three details, the EMI and the total interest outgo are computed instantly. As the online computations take just a few seconds to show the result, you can try out different permutations and combinations by changing any of the three added details. Once you get all the figures as per your preference, you can negotiate with the lender on all three parameters to avail the loan offer as per your suitability.
Opting for a personal loan is one of the crucial decisions that you make in your life. Thus, extensive research and abiding by certain strategies are a must before you hit on the personal loan apply button. With the assistance of the above-mentioned points, you can narrow down on an affordable personal loan option.
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