When planning to borrow money from a commercial lender, one of the key factors you have to take into consideration is the rate of interest charged by the lender. Obviously, you are looking for an affordable credit facility, so you have to compare the interest rates quoted by different lenders before you can decide to commit yourself. The rate of interest must not only be low, it should also be fixed.

The first thing you should do before you start comparing lenders is make a list of the top-rated lenders. From there, it will be much easier for you to narrow down the search for the right lender. The following are some of the key factors affecting personal loan interest rates:

Your credit rating is the key factor affecting interest rates. Lenders usually consider credit scores when pricing their loans. Borrowers with low credit scores usually pay higher interest rates and vice versa. If you want to get an affordable loan, therefore, you have to build your credit to ensure you have a decent credit score whenever you apply for a loan. Servicing your loans accordingly and paying bills on time are some of the main strategies for building your credit.