People borrow loans for various purposes. If the intention is to buy a house or a car, the loan amount required would be large. In such cases, it wouldn’t make sense to take the first available loan. The terms of the loan, that is, the rate of interest and the repayment period should be studied first and only then should the borrower apply.
A person who wants to take a loan would first want to know the interest rate he would have to pay. He would then work out the monthly interest that needs to be paid and decide whether it is an amount he can afford. It is in his interest to take a loan with the least possible rate. For this he needs to compare the loan rates first.
He can of course, individually approach various lenders such as banks and financial institutions and ask them for their loan terms. He can then draw a table showing the comparative terms offered and select the one which is most suitable.
If you want the best loan rates, another better and easier way would be to look for the rates online.
A person wanting to take a loan just needs to log on to the internet and look for lending websites. These are connected to networks of lenders and are very useful for loan rate comparison.
Even before entering any data, one can see a table displaying the names of prominent lenders, the interest rate on their loans, the minimum and maximum rate of the loan they are willing to lend, the tenure of the loan and so on. They also indicate the APR (annualized percentage rate) which includes items like loan processing fees in addition to the rate of interest. So the borrower is in a better position to see which lender’s effective rate of interest is the least.
Borrowers who want the best loan rates, can thus compare loan terms from the comfort of their homes or offices without having to spend time visiting and speaking to each lender.