If you’re looking to apply for a personal loan, do compare the offers of lenders. Many lenders provide personal loans these days. And it is hard to find a great deal among them if you are new to loans. So, do a personal loan comparison and find out whose offer is better in terms of the loan amount, interest rate, and repayment. Because these are three important factors that decide the outflow of a personal loan. Learn how to do a personal loan comparison on the page below.
Tips for Personal Loan Comparison
The following is the list of things you need to keep in mind when you’re comparing personal loan offers –
Highest loan amount
Compare the loan offers on their loan amount. Because a lender offering the highest amount will be the preferred one. That lender has a wide range of options for your loan. On the other hand, one which doesn’t offer much compared to the other lender won’t be able to meet your higher lump sum requirement.
Lowest interest rate
Choose a lender that offers you the preferred loan amount at an interest rate comparatively less than the others. Because a less interest payment can help you afford the loan. Whereas, a high-interest rate will make it difficult to repay the loan. You’re eligible for a lower rate if you’re found to be highly eligible for a loan.
A lender who is offering flexible and long repayment options is preferable in a personal loan. Because it will help you afford to repay the lump sum amount in small portions. The longer the tenure, the smaller the EMI will be.
Minimum income requirement
You’ll prefer the loan offer that demands less income. Because not everyone earns a monthly income of INR 50,000. So, choose the lender whose eligibility requirement is a monthly income of INR 15,000 and above.
Available at a decent CIBIL score
If you don’t have an ideal score of 750 or above, choose the lender that can offer you a loan at a CIBIL of 600 and above. The interest rate might not be that good but you’ll get a lump sum amount to meet your financial requirement.
Comes with an option of co-borrowers
A Personal Loan Comparison can be done based on the co-borrower as well. If your lender allows you to jointly borrow a personal loan, it will be advantageous for you. As it will reduce the risk rate and the interest rate of your loan amount.
Tools Helping in Personal Loan Comparison
There is an EMI calculator that will help generate the repayment amount. If you use this, you get the idea of your possible repayment for different loan offers. It is great for Personal Loan Comparison when you’re confused between multiple offers. Let’s check out the below example and see how a Personal Loan EMI Calculator works.
Karan is confused between two loans. Both of them have their advantages. Lender one offers a loan at a lower interest rate of 14.00% per annum. Whereas lender two gives a lengthy repayment period of six years. So, he uses the calculator and sees whose repayment will be easier and more affordable.
For Lender I
Here, Karan gets a loan of INR 8 Lakh at an interest rate of 14.00% per annum. But the repayment tenure is only 48 months. Let’s see what will happen if he chooses the lender one. According to the calculator, his EMI will be INR 21,861 and the total interest will be 2.5 Lakh.
For Lender 2
The loan amount is INR 6 Lakh and the interest rate is 17.00% per annum. And here, he gets a six-year tenure. As per the calculations of the EMI tool, Karan’s EMI will be INR 13,348 and the total interest will be INR 3,61,033.
So despite the longer tenure, Kartan chooses the Lender One by doing the personal loan comparison. Lender 1 offers more loan amount and the interest payout isn’t also high. Whereas total interest charged by Lender 2 is half the principal amount.