Convincing Your Private Loan Lender to Lower Interest

A private loan lender may be more willing to lower your private loan interest rate and provide you with a better deal. In not wanting to risk losing customer relationships or having to go through the process of recovering their losses due to a loan default, the lender will entertain arguments as to why it is important to offer you a lower interest rate on your private loan.

A private loan can be used for a variety of purposes and have no limit as to the amount that can be borrowed. This means that the private loan lender has a keen interest in you maintaining your payment schedule and repaying the loan in a timely manner in order to avoid any legal process or administrative proceeding that may result in the lender having to cut their losses or take less than what they may be entitled to under the terms of the loan.

Argument #1: Compare Prevailing Interest Rates

You should research the prevailing loan interest rates to determine what the best rates are. You can use this information to talk to your lender to lower the rate on an existing loan or negotiate a rate on a new one. Having this information gives you the advantage of knowing what rates are available and what to look for when your lender makes an offer to you.

Argument #2: Show Ability to Consistently Service Loan

Making regular loan payments and having a good credit rating will help you convince your private lender to provide you with a lower interest rate. The better your credit rating, lower the interest rate you should be able to receive.

Monitoring your credit is important in obtaining good interest rates. You should periodically check your credit reports to determine your credit rating and make any adjustments necessary to improve your credit rating. A higher credit score can help lower your interest payments and allow you to qualify for a better loan.

Argument #3: Demonstrate Customer Loyalty

A loyal customer has an advantage over new customers that has not established a history with the lender. Opening multiple accounts or directing all of your loan business to the lender may help show your loyalty to the lender and allow you to qualify for special loan deals that are only available to premium customers. The lender will be more interested and motivated in keeping you as a customer than with a customer who does occasional business with the lender.

These are just some tips to help you work with your lender to qualify for a lower rate on your private loan.

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