If you're not sure, don't worry. That's what this post is for! In this post we'll walk through what to consider when applying for a loan and review some of the top options in the market. Low-interest rates can have a huge impact on how much you pay back over time – which is why it's worth shopping around before making any decisions.
If you’re considering borrowing money for a personal loan, it pays to shop around. You might be able to reduce your monthly payments significantly by getting a competitive rate on the money you borrow.
A $5,000 personal loan at 9.3% interest and a four-year term with monthly payments will cost you an additional $1,006.66 in interest alone.
$5,000 personal loan with 4-year term and 6.75% APR will be $719.30 in interest charges with a total savings of $287.36
Use these tips when considering low-interest personal loans:
- Check for additional fees. Personal loan providers in the market today offer varying terms and no set rates. Comparatively, beware of high origination fees when choosing a rate from what turns out to be a product with higher interest rates than most other competitors in the same category. Ask about these charges up front and try to find lenders that have better fee structures later on before you commit
- If possible, prequalify with a provider. There are providers that allow you to prequalify for a personal loan. This means that after submitting key details like your desired use for the loan, housing situation, and income, you can see your potential borrowing limits and rates without impacting your credit score.
- Evaluate the lender’s customer support options. Considering your lender’s customer service resources before signing the agreement will make a big difference if you run into issues or have financial difficulties when making repayments. Check out reviews – and their customer services team - to find the right fit.
Personal loans are often an ideal way to cover expenses when monetary funds need, with some providers even going so far as to offer 5% interest rates on these loans. However, whether you go with the highest or lowest rate will depend on your credit score, and only those people in the top tier qualify for lower lending rates.
A low-interest personal loan can make your debt more manageable. Applying for a traditional bank, online lender or credit union will provide the best solution for your needs due to their many rates and terms options.