Did you know that within the space of 2 hours, you can get a return offer for your loan application with Lendingpot? For individuals (and businesses alike), Lendingpot offers a convenient resource to streamline what was previously a lengthy and arduous process, involving much research and a plethora of documents to complete.
But there’s more to our marketplace than simply being a place where borrowers can gain access to a multitude of lenders. For example, you only need a single application to reach more than 20 pre-approved lenders. Furthermore, you can calculate the instalments on your personal loan. In addition, with the right approach, you can secure low interest rates. Our focus today will be on the latter, we’ll share tips and tricks on how to get low interest rates on your loans with Lendingpot.
One of the cardinal recommendations before signing on any dotted line is to avoid settling for the first lender you encounter. This is because interest rates, terms, and fees vary between lenders.
By merely registering and applying through Lendingpot, borrowers put themselves in a position of power by being able to access the lowest rates through comparing offers from the lenders on our platform. Furthermore, by virtue of the competitive lending environment provided by our platform, lenders are driven to offer the best rates to attract borrowers.
As you’re probably aware, loans come in different shapes and sizes, from the more purpose-specific options such as wedding loans, student loans or renovation loans, to personal loans that can be used for any purpose.
Depending on your needs, considering different loan types might potentially result in lower interest rates. For example, you could opt for a secured loan (loans backed with collateral) to get a lower interest rate compared to what you’d normally get with an unsecured loan. Or you could opt for a specific loan that aligns with your needs (such as a student loan, if the goal is to further studies) as opposed to a more conventional personal loan.
Read more: Using Personal Loans for Your Business - Smart Move?
It is customary for lenders to use credit scores as a means of determining the likelihood of a borrower defaulting on a loan. Better credit scores often result in better interest rates. Conversely, bad credit scores are likely to result in higher interest rates to compensate for the higher risk of default.
There are a couple of ways for borrowers with bad credit to qualify for lower interest rates. The first, and most obvious, being to improve your credit score. If your financial needs are immediate, you can opt for secured loans, or, in the absence of sufficient collateral, apply with a co-signer or guarantor. To put it simply, co-signers agree to be responsible for repaying the loan in case you default on the loan.
Read more: Fixing a 'Jialat' Credit Score to Get Your Bank Loan Approved
Besides credit risk, there are several other factors that affect loan interest rates, including the convertibility of the loan as well as its term. By convertibility, we mean loans that can quickly be converted back into cash in case of a default, for example, highly liquid collateral such as high quality corporate bonds.
Long-term loans—meanwhile, incur greater risk due to the increased potential for adversity leading to a default. In addition, lenders also may charge higher processing fees which should always be considered when calculating the overall effective cost to your loan. The bottom line, if all else fails, consider opting for a shorter loan term if you wish to secure lower interest rates.
Read more: How to Get the Best Rates from Licensed Moneylenders
Contrary to popular belief, you are not entitled to accept the first offer provided to you by a lender. You can opt to reject any and all of the offers made to you, or (as we recommend) you can also negotiate for better terms.
It helps if you have a strong understanding of your position as a borrower, including the advantages that your credit score, financial stability and prevailing marketing conditions can provide—regardless of whether you wish to use the knowledge to negotiate better or secure better interest rates.
By comparing different lenders, negotiating, exploring various loan types, opting for shorter loan terms and considering a cosigner, you are well-positioned to get lower interest rates on your personal loans with Lendingpot.
As the saying goes, the proof of the pudding is in the eating. Register today and experience firsthand how Lendingpot can make a difference in your quest to acquire low interest rates.
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