Are you an undergraduate student looking for a low interest student loan? If you do not have the credit or collateral to take out a loan, you can try the Federal Parent PLUS Loan. It has a fixed low interest rate.
It is possible to find a low interest student loan, but you do have to meet certain criteria. Most college students would not be able to meet the criterion, but the more you meet the lower rate you will be able to fine.
Another low interest student loan is the Federal Perkins Loan. This is a government-funded loan for those who are in financial hardship. The Federal Perkins loan charges a 5% interest rate. It is fixed at this so it will not adjust.
With the right credit history and the right terms, you can usually find just the loan you need. Having a good credit history is the best way to get a low interest loan. If you have late payments, too much outstanding debt, or too many inquiries into your credit history, this will all affect your rating. If you know you will be looking for a loan in the future, start now to repair your credit rating. Six months of stellar history can work wonders on a bad credit score.
Typically the longer the term for borrowing money, the higher the interest rate. To get a low interest rate loan, squeeze the terms into the smallest possible number. Cutting the term from a 30 year fixed rate to a 15 year fixed rate could save you as much as a full percent in the interest rate. The payment may seem a little higher, but the amount you actually make up in interest will be significant. The savings could actually reach into the thousands.
There are two types of loans, secured loans and unsecured loans. Secured loans require you to offer the lender any of your assets such as your home as collateral. This collateral serves as security against defaults in payments by the borrower. If you do not pay back the money borrowed, the lenders have the power and authority to take the collateral to recover their payments.
An unsecured loan does not require collateral. When no collateral is required, the lenders have more risk. To compensate the increased risk in case of default, lenders charge a higher rate of interest as opposed to a secured loan the risk is lower therefore the rate is lower.
Finding a low interest loan is still possible, especially when the interest rates seem to be dropping as they are. It does take some pre-planning and patience and some personal investment, but the benefits far outweigh the costs. Low interest rate loans are available in most types of loans such as secured/unsecured home loans, student loans, auto loans and personal loans.
Therefore, do your homework and get the best possible low interest rate loan that will work for your personal needs.