Yes, SBI offers you a personal loan at the lowest interest. The starting rate is 9.60% per annum. If you want the lowest SBI Personal Loan Interest Rate, you need to show your credibility for it. You need a good credit score and high income to prove you’ll be eligible for a lower interest rate. Because you must know this is an unsecured loan. And due to the risk attached to the lump sum amount, banks charge a higher interest rate on personal loans than other types. So, SBI will consider you for a lower rate if you have a high income to aid timely repayment and have a good credit score to convince the bank about the same. Read this post and know more about the Personal Loan Interest Rate.
How does Credit Score Impact SBI Personal Loan Interest Rate?
SBI checks the applicant’s credit score to find how he/she handles a loan. A score of 750 and above shows a good repayment track record. But a score of 400 to 600 represents poor credit management.
When does a credit score decrease?
- If you leave a loan repayment
- Use credit cards excessively
- Haven’t paid credit card bills for a long time
- Multiple credit card usage
- Co-signed someone’s loan and haven’t repaid the amount when the primary borrower defaults
So, do check your credit score online before applying for an SBI personal loan. Because a poor credit score can result in higher interest rates or application rejection.
Choosing the Right Tenure Can Help Reduce SBI Personal Loan Interest Payments
If you choose your repayment period wisely, the interest payout can be reduced. To do so, you can take the help of the Personal Loan EMI Calculator. This tool allows you to see the EMI amount before getting the loan. Using this one can plan his/her repayment. To use the same, follow the below instructions –
- Log on to SBI’s official website
- Select ‘Personal Loan’
- Select ‘EMI Calculator’ from the sidebar
- Insert loan amount, interest rate and tenure
- Click on ‘Calculate’
The EMI will flash and so will the interest on your screen.
Let’s check out the below example and know how Personal Loan Interest can be managed with this online tool.
Sanjana is looking forward to applying for an Personal Loan. but before doing that, she uses the online calculator to see what her EMI will be. She inserts the following in the EMI calculator –
- Loan amount – 3 Lakh
- Interest Rate – 16.00% per annum
- Tenure – 36 months
The outcome is –
- EMI – INR 10,547
- Interest – INR 79,696
As you can see from the above example, despite a high-interest rate, Sanjana reduced her interest payments by choosing a suitable tenure. So, do the same when you’re applying for a personal loan from SBI.
Having a Co-borrower
When you jointly borrow an SBI personal loan, the repayment liability is shared between the two individuals. So, if due to any reason, you’re not able to continue repaying, the co-borrower will step in.
How does it work? Suppose you have jointly borrowed an Personal Loan of INR 6 Lakh at an interest rate of 13.25% per annum for six years. And during the tenure, you lose your job. In a situation like this, the co-borrower will repay and protect you from being tagged as a defaulter.
If the co-borrower doesn’t repay the loan, both primary and co-borrower will be liable for legal actions.
So, if you’re looking to borrow a personal loan, choose SBI as your lender. As it offers the lowest rate of interest on your loan. Plus, you get a wide range of loans from INR 25,000 to INR 20 Lakh.