Life is like one big roller coaster ride, with its highs and lows, leaving the humankind exhausted and not looking for bumpy ups and downs. The main force driving the workforce and the economy is money, and there are no two minds about it.

At any given point of time, every person, no matter where he is, is thinking about how to earn or make that extra, to meet his demand and that of his families.

The demand is equal to supply only in theoretical terms. The demand and supply of funds are never equal in anybody’s life. To fulfill this deficiency, loans are used or taken. A loan can be defined as the transfer of funds or monetary assets from the borrower to the lender. The opportunity cost of the lender for parting with the resource is termed as the interest. A loan can also be defined as a contract between two people, in which the borrower promises to repay the money taken from the lender along with interest.

The best loan has no fixed and regular definition. It can be explained in layman’s terms, as a loan in which both the parties to the loan contract are happy with the terms of the deal and have a feeling of security. Therefore, what may seem to be the best loan for a borrower X may not be the best loan for borrower Y. Thus best loan varies from person to person and their needs.

The best loan can, however, be distinguished based on the following factors:

Rate of interest

The rate of interest should not be very high. There is a particular cut off rate of interest given by the apex governing body of the country, and no lender is supposed to charge rates higher or lower than it. Hence rates are between the two boundary lines. The best loan will have a rate of interest which is closer to the lower boundary line. A borrower should shop for the rate of interest thoroughly and get the best marginal rate that is easy on his pocket.

Processing time

The best loan should take less time to get processed. Loans which have tons of formalities and consume a monthís time just to get processed are tiring. Once the borrower furnishes the documents, the lending authorities should investigate, verify and process the loan fast, so that the borrower receives the money in time.

Terms of repayment

The best loan should have terms of repayment, which is easy on the borrower. If the amount to be repaid in every instalment is hefty, the borrower will be stressed, and at some point of time or the other, he will have to borrow more to settle of the repayment. Thus, when a borrower is judging a loan, he should keep in mind the repayment amount and compare it with his incoming money sources.


These are the essential points which the borrower should keep in mind so that the loan he chooses gets him the best. The best loan can be shopped for easily, only that it requires a little bit of homework. It is best to compare the deals of many lenders and also read various schemes and programs offered by them. A lot of information can be got from the internet, and it is beneficial. One can also find lenders on the net who give attractive loan offers. The borrower must know what he wants and place his priorities right.

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