Personal loans are a very important tool for people who are in needs of funds. Not only are there various types of personal loans but they also have a lot of uses. Personal loans are very popular in India; as a result, there are multiple sources that provide personal loans, such as NBFCs, Banks, and online lenders. Since, there are a plethora of options available for personal loans, you can face dilemma of choice. However, there are certain factors that you need to consider when applying for a loan. The most important factor is the personal loan interest rate. While many people might tell you that you need that whichever source offers the lowest rate is the best that is not the case. The personal loan interest rate is important, but it depends on the tenure of the loan along with your credit score and EMIs (Equated Monthly Installments). So, if you are applying for a personal loan, here are the factors that you need to consider:
Factors that Affect Personal Loan Interest Rate
Tenure of the Loan
The tenure of the loan means the duration of the loan in which the repayment of the loan is to be completed. It is a crucial factor as a larger tenure of loan could mean lower EMIs while a smaller tenure could mean higher EMIs. Based on the first glance, it seems that having a larger tenure is the best option as the EMIs would be smaller. But, it will result into higher personal loan interest on the loan. Thus, you the total amount of your loan with interest could end up being higher because you wanted small EMIs.
EMIs (Equated Monthly Installments)
The EMIs are the amount that you are required to pay to the lender each month to repay the loan. If you cannot afford a high value of EMIs, then you need to pay a lower personal loan interest. However, depending on the lender, you may have to pay an additional amount for repaying the loan earlier than the tenure. The best thing to do is to use the Personal Loan Interest Calculator to ascertain the value of EMIs that you can afford.
Your credit score is essential to personal loan interest rate. Think of your credit score as marks given by your teacher for an exam. However, instead of your current performance, credit score also considers your credit history. The ideal credit score is 750, if you have a credit score below that, you may not be eligible for loan, or you may need to pay a very high interest rate. However, if you have a credit score higher than 750, you can get a lower interest rate.
Attractive Personal Loan Interest Rates at PaySense
PaySense not only provides you the best personal loan interest rates based on your credit history, but they also sanction the loan instantly. Yes, you read that correctly! You will not need to wait days to avail a loan, instead the amount will be credited instantly into your account. Moreover, you can use the Personal Loan Interest Calculator to find out the amount that you will need to pay along with the EMIs. Additionally, you will also be able to find out the best tenure of the loan.
Apply for Loans of upto ₹5 Lakhs easily using your phone or laptop, and pay back on low EMIs