Personal loans are very easy to obtain these days. But there is one thing that people hate about personal loans and it is the interest rate. Whether you choose a conventional personal loan or small personal loans for say 20€ you should target timely repayment. Here are some easy ways to lower the personal loan rates –
- Compare the interest rate and the term of the loan
It is a combined evaluation of the loan tenure and the interest rate that actually helps you understand the cost incurred by the loan. Compare the effective price paid back for long duration lower interest loans and short duration higher interest rate loans.
- Debt consolidation
Debt consolidation is very useful when you have more than one loan. The repayment process becomes simpler and the interest rate comes down a little.
- Timely repayment
If you have been repaying all your previous loans on time and if you have a very good credit score you can negotiate for a good interest rate on your personal loan. Banks with which you already own multiple products like deposits, savings or checking accounts, credit cards and more, are likely to offer better rates on personal loans.
- Insurance for the loan
Opting for a loan insurance would not just offer you security but also help you slightly lower the interest rate of the loan.
Most of the personal loans come with a lock-in period and additional charges for early closure of the loan. You might be incurring additional expenses if you repay the loan earlier than the term. So, it is alright to deter the closure process. But for this, to be able to continue paying installments for a longer duration you should choose a smaller interest rate loan that reduces the monthly burden. And when you do close the loan make sure that you fully understand the closure process and get the acknowledgment of loan closure from the lending institution.