Shopping around for the most attractive interest rates is the obvious move to make for most people looking for a loan. Lower interest rates mean you pay less every month and you reduce your total debt amount faster. To that end, we thought it would be useful to share with you some essential tips to follow when looking for the best interest rates for your loan.
1. Know What to Shop Around For
Before you even go looking around for the best interest rates, take some time to really consider the kind of product that suits your situation best. If the amount you need is only a little more than your current monthly salary, perhaps a credit card would work better. Or if you’re looking for funds to start a business, a business loan would be more appropriate than a personal loan. Both these options are better alternatives for their purpose because they would be cheaper, have features that suit their intention, and in many cases, would offer more attractive interest rates than personal loans.
2. Know Where to Shop Around
Calculating interest rates can be confusing and getting the right information from different lenders’ websites can be challenging. What you can do is use a comparison site like RinggitPlus. Sites like ours often have a helpful loan calculator for you to find out exactly the kind of loan from which bank that can offer you the best deal for your needs.
3. Don’t Apply for Multiple Loans or Credit Cards
Each time you apply for a new loan or credit card, it counts as a hard inquiry in your credit report. If too many of these appear too close to each other in your credit report, it might indicate to lenders and banks that you’re a high-risk customer, short on cash or getting ready to rack up a lot of debt. This in turn, may affect the interest rate you’ll get when you apply for a loan.
4. Make Sure Your Credit Score is Healthy
Speaking of credit reports, be sure to check your credit score via CTOS to ensure that you’re in good shape. If it doesn’t look that good, lenders and banks might offer you a lower interest rate. Remember to pay all your credit obligations on time and avoid missing payments.