If you are expecting some liquidity needs in the near future, and do not have adequate funds to meet them, a personal loan is a good way to bridge the funding requirement. However, while many people can avail of personal loans, not everyone can make their loans work harder for them.
What are personal loans?
Personal loans are loans given by banks and other alternative lending institutions to people who want to meet their immediate liquidity needs. These loans can be issued for a variety of reasons, such as an upcoming vacation or a marriage in the family.
How can you make your personal loans work harder for you?
Here are some ways to achieve this:
Negotiate a better rate
You could make the mistake of believing that everyone is equal in the eyes of lenders. If you have received a personal loan at let's say 11% interest rate, youmight think that others have also received their loans at the same rate. However, this thinking would be faulty.
By engaging with your lender, you can actually wrangle much more attractive terms for your personal loan. If you apply for a loan with a good credit history, you can and must ask your banker for better interest rates.This is easier than you think, and in most cases, if you have a good repayment track record, your bank will give you a better interest rate than the one available in the market.
Compare interest rates
There are plenty of websites that allow you to find the best options. Just do a bit of research online and find the best interest rates that a lender near you has to offer.
Transfer your loan
If your lender is not willing to reduce the tenure or interest rate of your on-going loan, you have the option to shift your loan to another lender. Make sure that your new lender provides you with more attractive terms.
We live in an era where information is at your fingertips. Everything is possible and all it takes is a little effort. As such, getting more attractive loan terms is not as hard as it used to be.
Disclaimer: Copyright Kotak Mahindra Bank Ltd.
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