Personalised to your needs is the personal loan. It would be wise to take a loan on fixed rate of interest as the finance market rates are currently low. It is likely to rise in the near future, if you want to continue your borrowed funds at the current loan rate then you must fix it at this current rate. This helps you to pay the same amount for as long as you hold the account with them. Isn't it a solace from the sudden rise in the loan rates which is likely to occur?
RBI has raised its cash reserve ratio to 6 %. With the growing inflation the rate at which it borrows and lends to other banks has been increased by several points. Try not to default on your payments, missed payments or late payments will cost you a fortune with increased interest rate. Credit cards also experience similar kind of situation, do not default on your credit card payments too.
The golden rule in borrowing funds still holds good!
Security of a good size
Good credit rating
Type of funds you opt for will definitely play an important role in determining your interest rate. If you take up secured borrowed funds, such as a secured loan you will qualify for better rates. The higher the equity better is your rates on loans.
Credit standing, as you all know is another determining factor. You will not only qualify for loan approvals but also get good rates. Easy and flexible loan options are also combined with a good credit standing. Your credit scores are collected from the credit agency such as Experian, Equifax and Trans Union. It is a statistical method to determine the likelihood of a borrower paying back the money he or she has borrowed. If you have defaulted on your credit card payments, store card payments or other borrowed funds in the past, have debts and arrears your credit report will reflect a poor credit rating and vice versa. FICO score is related to this credit score.
In case you have paid back your pending payments, you need to approach a credit agency and get it corrected so that your credit standing will reflect a positive score in future and qualify you for a better and competitive rate on borrowed funds.
Longer duration on your borrowed funds will offer lower EMI (Equated Monthly Installment) amount. The amount you pay on your borrowed funds will be lower as it is stretched for a longer duration.