How to Reduce Interest Burden Amid Pay Cut
The pandemic has really brought a tremendous change in everybody’s life. From lifestyle, to economy on the whole, the whole living structure has been altered by the outbreak. The pandemic has brought a lot of adversities to the common man. From losing job, struggling with the finances, all these things have turned into a reality. Also, the working professionals are bearing the brunt of salary cuts. Hence, people are opting for financial solutions so that they can lead a steady life in these difficult times. For example, in order to fulfill the financial needs, people go for personal loans. However, loan comes with interest rates and associated charges that can cause a serious dent in the finances. So, it is very important to carry a thorough research and compare various lenders, so that you can know who provides loans at lower rate of interest. If not, you can look for ways to reduce the burden of interest rate. So, here are some of the ways to reduce the interest burden amidst the pay cuts.
Opt for Balance transfer facility
If you feel that you are paying a higher rate of interest on the loan, you have applied for, you can always switch to balance transfer facility. With this option, you can transfer the outstanding loan balance to another financial institution that is offering comparatively a lower rate of interest from the existing bank/NBFC. This switch can help you in saving a lot of money from the EMI amount. You can transfer your loan with Finserv MARKETS, and get benefits such as flexible repayment tenure, minimal documentation and much more.
Top-up Loans
While balance transfer facility is a viable option, you can go for top-up loans as well. Top-up loan is nothing but the extra amount that you can avail on the existing loan amount. Some of the important benefits of top up loan include lower interest rate and low EMI payments. Also, since you apply for top up loan with the same financial institution, the process of documentation and verification of the application are eliminated. Thus, top up loan is an effective way of reducing your rate of interest.
Make regular part payments
EMI (Equated Monthly Instalments) comprises of two components: Principal amount and rate of interest. With loans such as home loan, we end up paying a lot of amount as interest as well. In such cases, you can opt for prepayment facility. Prepayment is payment of the EMI amount much before the closure of the loan tenure. Prepayment helps in the reduction of principal amount, thus helping you save on personal loan interest rates as well. Thus, you can switch to prepayment facility and reduce the interest burden on your loan.
Negotiate with the lender
You can approach your lender and negotiate on interest rates. If you have a good track record of repayment, lender can consider your request. In addition, if you have a savings account with the same lender, it will give them an assurance that you will pay the EMIs on time. It also becomes easy for them to analyze your financial transactions. Thus, if you have a stable financial performance and good track record, there are very high chances that you can reduce your interest rate.
At Finserv MARKETS, you can opt for balance transfer facility on home loan and loan against property to get rid of interest burden. You can also go for top up loans on Finserv MARKETS. In addition, you can enjoy benefits like flexible repayment tenure, minimal documentation requirements, access to Financial Health Check Report (FHCR) to check your CIBIL Score for free and track your financial performance.
How to Reduce Interest Burden Amid Pay Cut
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