No matter where you live and what your circumstances, there is a good chance a lender can tailor a low interest loan to your situation.

It may not necessarily be the lowest rate that the particular lender offers, but rather the best rate he can offer based on your individual needs and what the lender is in a position to offer you at that time. The key to finding a low interest loan is knowing where to look.

For some lenders it is not economically feasible to offer a loan to anyone who isn't the lowest risk, but for others, there is a margin of financial conviction to assist those who are not financially successful.

Why some lenders take the time

The question that often manifests itself in conversations about the financial markets is why some lenders are more inclined to approve a low interest loan even for those who have questionable credit. It isn't difficult to find a lender who will offer a favourable rate to those with excellent or good credit, but those who have less than perfect credit have more difficulty.

Perhaps it depends upon the experience of the lender either with other customers or because of a personal experience. It may also be dictated by institutional policy, but whatever the reason, the consensus is that a low interest loan tends to be reserved for only the very best customers.

Will You Qualify?

It's a fact that those with the best credit and financial stability get the best deals on loans, but unfortunately, those are often the people who don't really need a low interest loan in many cases.

The reasoning for that is that many of those who qualify for a low interest loan have their own loan, which often qualifies them to deduct interest payments off their taxes; therefore, a low interest loan is not as pertinent to them as to someone who has no recourse for those high interest rates.

The interesting part about charging higher interest rates to those with questionable credit is that although the lender is seeking to recap his principle on the loan as soon as possible, he is courting the potential for the customer to struggle making the payments on a higher interest rate loan.

For the borrower with questionable credit, it's a Catch 22: he has to pay higher interest to get a loan, and by getting a higher interest rate loan, the higher payments may create an added financial struggle.

The solution

The answer to finding a low interest loan, no matter what your credit history, is in research and negotiation. No answer is final, so if you don't like the interest rate that the lender offers, you have an option to tell him that you have been quoted a lower rate by another lender, and he will either be willing to make a counter offer or tell you that is his best offer.

You do not necessarily have to have another offer under consideration, but you can use that as a bargaining advantage. The worst that is going to happen is that the lender puts you in a "take it or leave it" situation. It isn't likely that he will withdraw his original offer; that decision will have to be yours.

Bill Stone writes for Direct Online Loans who help homeowners find the best available loans via the http://www.directonlineloans.co.uk website.