When you think of applying for a loan, the first thing that strikes in mind is how much interest the institute will charge. Different loan apps show different interest rates; now you may wonder why?
Well, the answer is different lenders charge different interests depending on several factors. The more positive points you hold in the loan criteria, the less interest the institute will demand from you.
So, now when you are ready to apply for the loan application process, it is paramount that you know what will affect your interest rates. Thus, the factors that determine how much interest the instant loan app will show are hereunder. However, if you choose the Fullerton loan app as your credit partner, you can expect a low interest. Also, it involves easy-to-meet criteria against the personal loan.
Factors Affecting Personal Loan Interest Rate:
The following are the factors that will affect your rate of interest:
The foremost deciding factor is your income. As a personal loan is unsecured, you do not have to give the lender any collateral. So, the thing that makes the lender secure is your income. The more income you will have, the more secured the lender will feel and charge a lesser interest rate.
The lender relies on you more than you are capable of repaying your loan amount. Not to forget that for the personal loan to be sanctioned, the lender must trust you, which is not possible when your income is low.
But, in the Fullerton loan app, the lender allows you to get a loan even if your income is as low as 25,000/m in metropolitan cities and 20,000/m in the rest of India for salaried candidates.
- Credit history
If you have a bad credit score and applied for a loan in the past, you may know by now lenders do not sanction loans when the credit score is not enough. So, it is obvious the more credit score you hold, the better interest offer you can expect.
The range of CIBIL scores varies from 0-900. But to apply for a personal loan, you must hold a score above 750. In addition, if you have a score above 800, you can expect your interest rate to drop by 25% on the personal loan amount. However, you can get a personal loan in the Fullerton app even if your score is 750.
- Debt-to-income ratio
When you calculate the interest rate on the online loan app, your debt-to-income ratio is another thing that affects the interest rate. This ratio is the sum of how much you owe divided by your gross income.
Many mortgage lenders prefer the ratio to be as low as 43%. However, the standards set by different personal loan providers may vary, but all prefer a lower ratio.
- Relation with Lender
To ensure the best interest rate for yourself, you must maintain a healthy and professional relationship with the bank. If you hold an excellent loan history with your lender, like paying back the money right on time, then to retain the relationship, the lender will go to an extent by offering lower interest.
Fullerton’s online loan app also offers benefit schemes on top of lower interest to maintain a good relationship with its healthy customer.
- Employer status
Yes! The employer status, too, affects the interest rate of your loan. So, if you are an employee of a well-established company with high goodwill and success, you will have a plus point in the contractual loan terms.
Lender companies see such clients as their valuable customers and secure their financials. If you are involved with a high-end company and want to see how much advantage you can gain from an interest-rate perspective, you can download Fullerton insta loan app.
It’s essential to be aware of the factors that will affect your interest rate evaluate all the above factors. However, if you find you lack in any of the elements, work on it. It will help you secure yourself a profitable interest rate and a better loan chance in the future. Additionally, sign up in the Fullerton app and get the best interest rate in tow to make the process easier.