Fluctuations In Personal Loan Interest Rate In This Festive Season You Need To Know
Every seasoned finance expert advises people to watch the official websites of major banks during the festive season. Like every other business, financial institutions want to woo their customers. And there is no better time to do that than when they are merry and in the mood for celebrations.
The festive season in India begins with Diwali and goes on till the New Year. During this time, people are often on the hunt for gifts for their dear ones. It is also the time of new beginnings, like renovating a home, buying a car, or establishing a business.
Leading banks in the country foresee this. Hence, they slash personal loan interest rates to help people overcome financial limitations. Different banks offer different discounts on personal loan interest rates. Lucky consumers might also be able to land a deal where they can enjoy a loan processing fee waiver.
Without further ado, here’s more information about variations in personal loan interest rates during the festive season.
Why apply for a Personal Loan during the Festive Season?
From flexibility to a stress-free application process and low-interest rate, here are five reasons that make personal loans attractive during the festive season:
- One can avail of a greater Loan Amount
Usually, the amount one can borrow through a personal loan is limited. However, the limit is raised by financial institutions during the festive season. Depending on the bank, one might be able to avail anywhere from 5 to 25 lakhs. The money borrowed can help manage various expenses associated with the festival season.
- There is greater flexibility
Loans like home loans, car loans, or business loans should be used for a specific purpose. For instance, one can’t take a business loan and use it to buy a personal car. Nonetheless, a personal loan can be used for almost anything. For example, the borrower can use it to get Diwali gifts for the family or organise Durga Puja at home.
- Lower Personal Loan Interest Rates
The primary reason why personal loans are great during the festive season is because of the low-interest rates. As mentioned earlier, banks slash personal loan interest rates during the festive season. So, people can avail of them at pocket-friendly interest rates and without worrying about high EMIs.
- Hassle-Free Application Process
A lot of lending institutions these days are inching toward the digital mode. Of all the loan options, personal loans are one loan option that can be easily availed online. So borrowers don’t have to make regular visits to the bank’s branches. Instead, the documents can be submitted online. Once verified, the funds will be transferred to the applicant’s bank account instantly.
- There is no requirement for Collateral
Personal loans are unsecured. Meaning, borrowers don’t have to pledge a property, vehicle, or anything else to avail of the loan. Instead, the bank will use credit scores, salary certificates, etc., to analyse their eligibility.
How to get the best Personal Loan Interest Rates during the Festive Season?
People who plan to get a personal loan during the festive season should keep a few things in mind. The following tips will help land the best personal loan interest rates:
- Maintain a Good Credit Score
The credit score or CIBIL score is a 3-digit number that ranges between 300 and 900. It refers to a person’s creditworthiness. Or in simple words, it serves as a record of a person’s past loans and repayments. A low credit score shows that the borrower has been inconsistent with repaying the loan amount on time. A high credit score of at least 750 is considered ideal by lenders. It shows that the applicant has made payments on time without defaulting. Such people can often enjoy lower personal loan interest rates.
- Income and Job Stability matters
Lenders want borrowers who can repay the loan amount on time. They find the right borrowers through several factors. One such factor is employment stability and income level.
Applicants employed in their current organisation for six months or more are likely to get lowered personal loan interest rates. In addition, applicants who work at reputable companies might be able to enjoy discounts on personal loan interest rates.
When it comes to income level, the higher a borrower’s income, the lower the personal loan interest rate. This is because lenders consider borrowers with high incomes to be reliable. As a result, such applicants can afford the repayments and are less likely to default.
- Avoid taking Loans often
The festive season and the low personal loan interest rates can be tempting. However, people mustn’t borrow more than they can afford. Doing so can lead to unforeseen circumstances in the future. Hence, determine the needs, figure out a budget, and then apply for a loan. This will help steer clear from accumulating huge debt.
Conclusion: Find the Right Lender
The festive season pushes people to apply to multiple lenders. However, every loan application can affect the credit score negatively. A high number of loan applications means a fall in the credit score. Hence, people must check their eligibility criteria, income, and other financial aspects before applying to a lender.
In addition, people must work with the right lenders, like Piramal Finance. Piramal Finance’s personal loans can be assessed through a simple application process. The documentation is simple, and the personal loan interest rates are pocket-friendly. The amount borrowed can be used for any purpose. For instance, borrowers can use it to go on a vacation with family or do Diwali shopping.
Interested borrowers can reach out to Piramal Finance through their website. To learn more about personal loan interest rates, check the personal loan webpage here.