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A personal loan is considered to be the best form of emergency funding. The best personal loan is the one with the lowest interest rate on personal loan. A personal loan comes in handy, especially in case of unplanned expenses, whether it’s a medical emergency or home-related expenses. 

Financial Profiling is one important thing that defines the assured term for the loan repayment. The term and interest rate majorly depend on your employer, the job profile, net monthly income, and your expenses. 

Along with these, the most important factor that affects this emergency funding is the CIBIL score. It depicts your behavior with the borrowed money, whether the repayment of the loan is on time or not, or are there any other issues related to the late repayment.

A CIBIL score above 750 is considered a good CIBIL score, and below 650 is considered a poor CIBIL score. 

A personal loan is considered the best suitable loan during emergencies.  A strong and good financial report helps in negotiating with the lender. If the interest rates are low, the monthly EMI payment would be less and will result in cutting down the expenditure of an individual. 

Here are some simple measures that can get you a low-interest personal loan- 

  • More Than One Source Of Income

The lender focuses on the source of income more than anything. They require income level to be more than the expenses, i.e., the debt to income ratio should be less. If you have a stable income and the sources are more than one, then show all your trump cards to the lender. That will give him the satisfaction of repayment, and you’ll get an advantage of a low interest rate. 

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It is better to gain the trust of the lender and show him that you have more than sufficient income to pay off the monthly EMI. 

  • Approach Lender With Good Relations

If you have a bank account for more than 10 years in a bank or you have more than two loans running with a financial institution, and you are already a customer. Then based on the past relations with the lender, it can provide you a low-interest rate personal loan. 

Lenders like Bajaj Finserv provide pre-approved offers on personal loans to their select customers. 

  • Increase The Tenor Of The Loan

If you are getting a high lending rate, then be flexible in changing the tenor of the loan or the principal amount, it will help in cutting down the monthly EMI cost. Taking a higher amount will imply large EMI and put high stress on your expenditures. 

If you are taking a personal loan for an emergency situation and cannot adjust with the amount, then focus on increasing the tenor. Higher the tenor, the lesser the EMI repayment. 

  • Apply With A Co-Applicant

If you approach a lender with a co-applicant and the co-applicant guarantees your repayment, this way you can get a low-interest rate loan. After verifying the income documents of the co-applicant, if he/she fits the criteria, a low-interest personal loan is sanctioned to you.  

  • Offer Collateral

A loan with pledged collateral has a lower interest rate as compared to a loan without any collateral. Any transferable liquid asset can be considered as collateral including- Property, Land, Shares, and Bonds. If you wish to take a loan against these assets you can get a loan with a lesser interest rate. 

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To Sum Up

These are some of the simple strategies which can be used to get a low-interest personal loan. The best personal loan provider offers its valued customers flexible interest rates, and Bajaj Finserv focuses on this part. It provides customers with various offers on personal loans, credit cards, and home loans, for which you will be informed after filling up the basic contact details. 

Shabbir Ahmad

Shabbir Ahmad is a freelance enthusiastic blogger & SEO expert. He is the founder of Shifted Magazine & Shifted News. He contributes to many authority blogs including porch, hackernoon & techcrunch.