Life can always take an unexpected turn. Sometimes it’s about an activity that one just must undertake like home renovations or a family holiday. Sometimes It’s something far more critical like a sudden medical emergency or personal exigency. At such times, a Personal Loan can come to the rescue. However, a very important factor that must be kept in mind when availing a personal loan is the rate of interest or the cost at which the loan is availed by the Borrower.

There are two types of personal loans- secured and unsecured. You can easily obtain low-interest rates when you opt for the secured type personal loan. You can always discuss the type of loan and the repayment period and method with the lender. You can mutually decide the rate of interest which will be easy for you to repay and would not be too less for the lender.

Personal loan by nature is unsecured or collateral free. This means that unlike in case of a home loan or car loan, in case of a personal loan, Borrower is not providing any personal asset as security in case he is not able to repay the loan. Hence, in case of a personal loan the only way a Borrower can avail the Instant Loan and at low-interest rates is possibly by assuring the lender about their ability to repay the loan.

The interest rates at which you take a personal loan is generally fixed or floating in nature. A fixed interest rate is stagnant and does not vary according to the fluctuations in the money market, while the floating interest rate is the rate updated by the lender depending upon the on-going market trends. Some lenders also offer an option to take the loan which is a split of the two. This type of offer paves the way for low-interest personal loans.

One of the major benefits of a low-interest rate is that the monthly repayments will be manageable for the Borrower. A low interest rate Loan

can be selected by keeping both interest rates and loan tenure low as a very long-term repayment period increases the amount to be repaid in the form of interest.

Here is the list of top 3 things to keep in mind while taking a personal loan so that it can be availed at low-interest rates:

1.  Maintain a good credit report with minimum debts and unpaid credit card bills.

2.  Ensure stability with full-time employment with a reputable organization. Having two straight work years in a reputable organization is a plus point.

3.  Having personal assets such as a self-owned house or other regular income such as rentals.

Overall a convincing economic status goes a long way in assuring a lender that he will receive his repayments on-time. These things lay the groundwork for a low-interest rate. Every lender does a background check and has their own Loan Eligibility criteria's. The ability of a Borrower to present a stable and able financial status to the lender will ensure that the loan is not just approved but is also at a low cost.