How to get the best interest rate on your loans?
What's the story
Personal loans of all kinds—for weddings, travel, home renovation, education, or a medical emergency—are all easily available these days. One can get the best possible interest rate if you know, beforehand, what the bankers are looking for in your credit profile before they hand you cash.
So, here's what you need to do to get a competitive interest rate on your loan.
Details
Maintain a good CIBIL score
Maintaining a good CIBIL score is the holy grail as far as getting your hands on a loan with really low interest rates is concerned.
A CIBIL score computes your ability to pay off debts.
It is essentially a sum of past payments you have made and your credit history.
Any credit card bill whose payment date you forgot will hurt the CIBIL score.
Information
CRED gives you timely reminders about credit card bill payments
Thankfully, apps like CRED help you with their timely reminders on your credit card bill payments. What's more, CRED will give you reward points every time you pay your bills, which you can use to get access to curated products and experiences.
Seasonal offers
Tap into seasonal offers for discounted interest rates
Instead of immediately going for a loan at a higher interest rate, prioritize your needs and assess if you can wait to get a loan during festive times.
Seasonal offers tend to give you discounted interest rates.
The best way to access these loans is to know what the loan is for and the most ideal rate at which you want to avail it.
Interest rate
Find the best interest rate out there
After considering your credit profile, do reach out to online lenders who can offer a better deal.
In case you are servicing a loan already, the bank or finance company you have borrowed from will also be best placed to give you a good deal on the loan.
Knowing your CIBIL score is the first step to getting a competitive interest rate.
Information
Here's how CRED helps with your CIBIL score
CRED lets you access your CIBIL score for free. However, it doesn't just stop there. Members get tons of insights on how to be on top of their credit game and keep increasing their CIBIL score.
Professional History
Negotiate with your professional history
Your professional history, your job stability, the credibility of your employer all come together when it comes to assessing your credit profile.
Maintaining a good FOIR i.e., 'fixed obligation to income ratio score' will improve your credit profile.
Employment history with corporate bigwigs and government PSUs are also looked at kindly by bankers and can help you get loans at a cheaper rate.
Easy loans
Reaching a strong CIBIL score is a hard task
Getting a loan in this day and age isn't that difficult.
Even with a bad credit history, there are many who get their hands on easy loans but at an expensive interest rate.
This is far from ideal.
The hard task is to work your way to a strong CIBIL score and to honor all your credit commitments.
Information
CRED helps you find your updated CIBIL score for free
To make it easier to manage and improve your CIBIL score, we recommend downloading CRED, a member-exclusive credit card bill payment app, that not only helps you find your updated score for free but also gives you insights on how to improve the same.