Low Interest Personal Loans - Unearthed from the Deeps of Impossibility
Written by: James Taylor
Personal loans have a very old history of use in the UK. Banks,
even in the yesteryears, would similarly lend money to people
for a certain term. The manner in which personal loans are
offered may have undergone a vast change because of the
incorporation of new technology. However, borrowers' penchant
for low interest personal loans sees no decline.
What is it in a low interest personal loan that has borrowers
transfixed to them?
Most borrowers are very quick in answering this question. A low
interest personal loan, according to them is the first step
towards a low cost personal loan. Low interest personal loan is
one where interest rate is charged at the least possible rate.
Interest has the largest share among the several additions that
are made on the personal loan. Every year, an interest at a
certain rate is added to the personal loan. Interest signifies
the opportunity cost. Had the amount been deposited at any other
place, it would have earned a certain interest to the lender.
The lending agency would try to cover the interest and the risk
that is involved in the process of lending. These are the basic
components of interest rate.
A lower interest rate will add smaller amounts to the low
interest personal loan. The benefit of this can be had at the
time when monthly or quarterly repayments are being decided.
Repayments are calculated by dividing the personal loan and its
additions among the several months constituting its term of
repayment. When a borrower draws personal loan at a lower rate
of interest, he will surely have to pay less as monthly or
quarterly repayment (unless the other components of cost of
personal loan do not work against the low cost).
How does one proceed in order to have a low interest personal
loan? To reveal the complexity of the situation to borrowers who
think that the process is easier, let us remind that there will
be very few loan providers who will state that their personal
loans are anything other than low interest. To confirm the
validity of the statement, just have a look at the websites of
loan providers in the UK and you will find the majority as
having the adjective cheap and cheapest adorning their personal
loans. This is a complex situation and traps a large number of
people to so-called low interest personal loans.
Thus, the question as to how one must proceed in order to have a
low interest personal loan remains unanswered. Instead of
expecting someone to answer the question or find a low interest
personal loan, borrowers will themselves have to find the
answers to the question.
The first thing that borrowers must understand is that low
interest personal loan is not available readymade. Borrower
needs to put in effort in researching his own requirements and
searching matching personal loans in the financial market. This
will bring the borrower nearer to the desired low interest
Having learnt the truth behind the so called low interest
personal loans, you will certainly not believe the claims of
lenders easily. Every claim must be checked for its accuracy.
With the advancement in technology, it is not difficult to get
to the bottom of any claim. A similar tool is loan calculator.
Loan calculator is actually a computer program through which one
can compare rates of interest or APR of several loan providers
in the UK. A typical loan calculator looks like a table
displaying the APR chargeable by several loan providers in the
UK at a particular point of time. The list includes both big and
prestigious banks and the smaller financial institutions as well.
Yet another method of confirming that the lender actually offers
low interest personal loans is the personal loan quote. Through
personal loan quote, the loan provider is presenting an offer
before the customer. The offer document reads out the actual
details of the personal loan. The loan quote requires active
analysis of each and every term. The advantage of personal loan
quote is that borrower gets to know of the basic stats of the
loan without having incurred any obligation.
So, again it is the borrower himself who has the key to a low
interest personal loan. He would not find any obstruction in the
search as long as he has sufficient information to back his
About the author:
James Taylor holds a Master's degree in Commerce from JNU he is
working as financial consultant for chance for loans.To find a
personal loan,bad credit loans that best suits your needs visit