First things first!
Unlike housing finance, the personal loan may vary for each borrower. As a result, the best personal loan rate may be fluctuating for each borrower.
The best personal loan rates may fluctuate from 12% to 24% and depend on the matching of a customer’s eligibility criteria. It is the vital reason why two borrowers can get different interest rates even from the same creditor.
There are some factors that determine the best personal loan rate. Hence, if you are planning to apply for a personal loan, it is vital to understand such factors.
Here is a quick look at some crucial factors and how they affect the best personal loan rate. Read on!
1) A robust Credit Score leads to a lower rate
A CIBIL Score is a parameter for the lender to determine how well or bad you have managed your previous debts such as loans and credit cards. Every time you make a timely payment, it adds points to the Credit Score. On the other hand, being late or defaulting on your payments can also lead to bringing down the Credit Score. The Credit Score ranges between 300 and 900, anything above 750 is considered good. If you have maintained the CIBIL Score ranging 750 or more, a lender will feel confident to offer you a lower best personal loan rate. It is because you can pay the EMIs on time and hence, the lender will reward you with a lower interest rate.
2) Earning a higher income means a lower interest rate
For lenders, borrowers who are earning higher income are a safe bet. By approving such candidate’s loan request, the lender can be sure of getting the repayments on time. Hence, to reward such customers, creditors offer them a lower best personal loan rate. Example – A borrower earning Rs.30,000 may get a personal loan at a 20% rate of interest while anyone taking home Rs.50,000 may get it at 16%.
3) Working for a reputed company leads to a lower rate
If you are working with a reputed company, then it can help you get a good deal on your best personal loan rate. Lenders consider the employees of well-known firms as stable borrowers and responsible for paying the EMIs on time. Also, the nature of employment may affect the offered best personal loan rate. As a result, a salaried employee may get a different rate as compared to a self-employed. What’s more, all loan prospects nearing their retirement age may also need to manage a high-interest rate while trying to get a personal loan.
4) A healthy relationship with a lender may work in your favor
Did you that applying for a personal loan with a lender with whom you have a savings or credit card account may help in availing a lower rate? Yes, that’s correct! If you have maintained a healthy relationship with your lender, then you may apply for a personal loan with it and get it at a lower rate. It is because your current lender may not want to lose out loyal customers like you to another bank.
Some of the easy tips that can help you go ahead and apply for the best personal loan rate are now revealed. You can now implement those tips and move towards securing the best personal loan rate.
Bajaj Finserv is here to offer some pre-approved offers on personal loans, home loans, business loans, doctor loans, EMI finance and many more. The aim of such deals is to simplify your overall loan procedure and make it fast.
To unlock your pre-approved loan offers, all that you need to do is share your basic details such as your name and mobile number.