People may need to secure a loan for many different reasons, whether that’s to pay for a university course, an extension on the home or vehicle financing. Loans are needed when something can’t be paid upfront in cash. When you borrow money, getting a good low interest will help save you money in the long run. Here’s how to get the best personal loan:
Have Good Credit
One thing that can get you really low interest on a personal loan is good credit. If the lender can see you have a good credit rating then not only are they more likely to offer you the loan, they are more likely to offer you low interest rates.
Take a look at your credit rating and see what it looks like to a loan company. If your credit rating isn’t very good, there are certain ways you can give it a boost. You can apply via a targeted application and negotiate with creditors to help get you a better APR.
To make sure you’ve got good credit you must make sure any money you owe is paid off, such as phone bills and car insurance. Missed payments will lower your credit score while paying all of your bills on time will improve it.
Secure A Loan With Assets
You can get a better APR on loans by securing them with any valuable assets you may own. This is called a “secure” loan, and while it seems like a good idea you must remember that if you miss a payment or fail to pay off the loan then your valuable asset is at risk. This could be your house or car, so make sure you really can pay off the loan before applying and putting your property down for security.
Consider All Of Your Options
You don’t just have to borrow your loan from a big well known company. When finding a loan with low APR, consider all of your options.
You could micro-lend or even peer to peer lend, where single investors will probably be able to offer you better loan rates than you would usually find.
Have you thought about an informal loan? Your mom/dad/nan/aunt/sister could be more than happy to lend you some money informally while adding on no interest at all. Depending on the amount you need to lend this could be the best option to try before anything else.
You could always offer a family member interest when asking them to give you an informal loan, but you must be sure you both have a lot of trust for one another before the loan occurs.
Try Government Programs
The government can sometimes offer low interest loans to people with low income or low credit ratings. It’s worth taking a look at this option to make sure you get the best possible interest on your personal loan.
Always make sure you know the repayment terms and ensure the interest rate is fixed. Read through any documentation properly before signing anything!
