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The APR And Fees Associated With Instant Cash Loans

The most common term in the financial sector is an Annual Percentage Rate or APR. This is particularly relevant to borrowers. But sometimes most borrowers don’t know about it. The borrower widely applies interest rates to calculate the overall cost of a loan. In addition, APR represents a more comprehensive alternative to loan costs.

Before you sign on the dotted line, if you consider taking out a personal loan, you should estimate your personal loan percentage or average rate of interest. It will allow you to see the complete picture of your loan, enabling you to make the correct choice.

To determine the overall cost of a personal loan when used for a period longer than a year, you must account for the number of years it was borrowed.

Let’s proceed with this article for a better and more detailed understanding of APR.

Understanding Annual Percentage Rate

The annual percentage rate (APR) refers to the entire cost when you get an instant loan from a lending institution or bank. Instead of the interest rate, the APR is an annualised percentage that accounts for all loan costs, including the interest rate, transaction fee, pre-payment penalties, and taxation.

APRs are typically greater than interest rates in general. This is because APR considers both interest rates and other fees related to borrowing money. The annual percentage rate, or APR, is what its name suggests. In other words, the Annual Rate of Expenditure’s annual cost is equivalent to a yearly fee.

APR Benefits Over Interest Rate

The APR is a more comprehensive tool for estimating your total loan costs than interest rates. For potential borrowers, a few advantages of the APR can be found in the following terms:

  1. The comparison of costs is more accessible:

The best way to compare banks’ charges is to use the APR. There is a difference in the cost structure of each lender. Costs such as processing fees, prepayment charges, etc., may differ when lenders charge interest rates in line with each other. That might have a significant impact on the total borrowing costs. Therefore, the APR and not just the interest rate are to be considered when comparing credit products from various lenders. To obtain more information and make better decisions, borrowers should ask to be charged an additional interest rate before taking out a loan from their lender.

  1. Takes all costs into account:

As indicated above, the personal loan percentage, or interest rate, is a figure that considers all the costs involved in borrowing. The interest rate, fines, waivers, prepayments, charges for processing fees, or additional costs shall be included. As a result, compared to interest rates, this method of evaluating the cost-effectiveness of loans is more accurate.

The APR rate is a figure equivalent to the interest rate for an annual period. You can use the APR to calculate your yearly costs. It’s easier to make use of an interest rate that is already annualised because financial accounting usually takes place every year. You can also calculate it based on interest rates to know the total cost during your loan term.

Ways To Lower APR For Personal Loans

The rate of interest charged on a personal loan may be reduced. To apply for your loan, you will need to take the following steps:

  1. Secure the Loan:

As a result, secured loans have less risk and will be more expensive than unsecured loans. A secured loan is when you provide the lender with collateral, such as assets or jewellery. Secured loans are cheaper because, if the borrower cannot repay them, lenders have considerably greater confidence that they will be repaid by diluting their secured assets. Try to negotiate a reduction of your interest rate with your lender and convince them that you will secure the loan against collateral to reduce their interest rates.

  1. Improve your credit score:

Your credit scores are a measure of your creditworthiness. The higher your credit score, the more trust lenders will have when lending to you. They’ll offer you the lowest interest rate since lenders trust you and are more sure of returning your money.

  1. Apply loans from non-banking lenders:

Many borrowers assume that banking is their sole option when they apply for a loan. There are many lending companies in India called Banking Financial companies, or NBFCs. Compared to banks, these firms typically offer loans at a low-interest rate.


Instead of an interest rate, the annual percentage rate is a better way to estimate your loan costs. You can determine your rate using the APR calculation tools available online. If you can prove to your lender that you’re credible and capable of servicing the loan, its Personal Loan percentage will be reduced.

If you are willing to take out instant cash loans and are looking for a reliable online lender, check out one of the instant loan apps Fibe, for personal loans. It offers an instant loan at a very low-interest rate and flexible repayment terms within a few minutes.

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