When it comes to borrowing money, the single most important factor to consider is the interest rate. You can forget else everything except this number. It is essentially the cost of borrowing, usually expressed as a percentage of the principal amount. The rule of thumb is to avoid high interest and find low interest whenever possible. You will be doing your future self a big favour by being financial astute today. Below are some of the benefits of low interest rate loans:
Easier to Pay
Imagine having to pay back a loan at 50% interest per annum. If you borrowed $100 from the lender, then you would be obligated to pay him back $150 at the end of the year.
Larger Loan Amounts
Since the rates are low, you can consider borrowing a larger amount that you would if you were faced with high rates.
Longer Terms Feasible
As illustrated in the examples above, high interest can be crippling with the way that they grow per year.
