Personal loans have seen exponential growth in the past two decades in India and are availed by millions of customers for various needs. They require minimum documentation and disbursal is faster as compared to other types of loans. A personal loan has become the preferred instrument for public and private banks in India who earn handsome interest by disbursing these loans at a short notice.

At the time of applying for a personal loan one should take into consideration the following points to avail a low-interest rate:

1. If you have maintained a good credit score for your previous loans, chances are the bank will offer you a slightly better rate of interest on a fresh personal loan considering your clean credit history.

    

2. If you have maintained a good repayment track record without defaulting on the previous loan EMIs, you can negotiate a better rate of interest with the bank for a personal loan.

    

3. Applying for a personal loan during festive season increases your chances of availing a reduced rate of interest as banks come up with special loan offers during the festive season.

    

4. Your relationship with the bank over the years can also be a factor in getting a better interest rate on a personal loan. if you are an existing customer of the bank with an excellent payment track record, you can expect to get a discounted rate of interest on a personal loan.

    

5. Employer’s credibility and a stable job can also play an important role in getting a better rate of interest on a personal loan.

    

In summary, you must take stock of the available lending institutions offers and choose the one which suits your needs the best. 

Must Read: Golden Rules You Should Follow While Taking A Personal Loan