Planning to take a personal loan? Do not over-leverage this festive season

Here is how the personal loan rates offered by various banks stack up

Sanjay Kumar Singh
Last Updated at September 15, 2019 23:36 IST

Photo: Shutterstock

There is a wide variation in interest rates on personal loans. They can range from 10.35 per cent to 21.5 per cent
A personal loan of Rs 7 lakh taken for five years at an interest rate of 10.35 per cent will mean an EMI of Rs 14,994. The total interest cost will come to Rs 1,99,626 over the tenure of the loan
On the other hand, a similar loan taken at the highest interest cost of 21.5 per cent will mean an EMI of Rs 19,135 and a total interest cost of Rs 4,48,086
Due to such wide variation, it always makes sense to scout around for lenders who will make the best offer instead of opting blindly for the pre-approved loan offer that you enjoy with your bank
By maintaining a good credit score—of above 750—you can ensure that you get this loan at a lower rate
With the festive season around the corner, lenders will make attractive offers
Make sure that the sum total of all your EMIs does not exceed 50 per cent of your take-home salary
Interest rates on loans against assets are more attractive

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