What is the best way to reduce the monthly EMI of a personal loanIn the current Covid-19 pandemic situation, an increase in personal loans have been witnessed, as many people lost their jobs, experienced a reduction in salary or businesses shutting down. To overcome such a financial crisis, plan your finances well, whether it is a personal loan or managing your existing savings.
A personal loan comes as a savior when an individual is left with no other way to raise emergency money. Though personal loans have high-interest rate, every month instalments (EMIs) can be smartly planned so that the repayment becomes stress-free every month.
As a borrower, you have the flexibility to customize the tenure, interest rate and loan amount using the EMI calculator available on instant loan apps and websites. If the EMI still appears out of your budget, consider ways to reduce your personal loan EMIs.
Best Ways to Reduce the Personal Loan EMI
- Go for a higher down payment- While buying a commodity or a property, paying off a down payment in excess reduces the interest rate and the EMIs as well. Hence, if you have taken a higher loan amount, use a chunk for a high down payment to reduce EMIs.
- Choose a loan with a longer repayment tenure- When you opt fora longer loan tenure, the total amount due is divided over a longer duration of the loan period and reduces the EMIs.
- Plan the loan amount- EMIs depend on the loan amount borrowed, the best way to minimize is by borrowing a limited amount of money, according to your need.
- Compare Online- With increased competition, many lenders offer attractive interest rates and other discounted schemes to woo the borrowers. The online loan process has made it easier to compare with other competitors and decide the best option for personal loans available at the reduced interest rates and EMIs.
- Consider your existing lender- The best way to reduce an EMI is by taking a personal loan with your current lender. It makes sense to avail a personal loan from the same financial institution as a top-up loan. Maintaining years of credibility with the lender enables flexibility in availing the desired EMIs.
- Negotiate with the lender- If you are taking a loan from an existing lender, you get the option to negotiate a low-interest rate. The lender can reduce your interest rate based on your credit score and repayment ability.
The technological advancement in the software industry created a useful tool like an EMI calculator. Break the myth that is complex to use. It works on the basis of 3 variables – loan amount, percentage of interest and loan tenure. So, borrowers, if you are clear with these three variables, make use of the EMI calculator to derive a suitable EMI. In case, you want to reduce the EMI, flexibly re-enter the new variables and wait for quick results in seconds. EMI calculators beat the manual ways of calculating EMIs that were quite time-consuming and not 100% correct always.
So, overall know your EMIs in advance and accordingly apply for a personal loan. This will easily manage the repayment of instalments throughout the loan tenure.