Most of us be it freelanced or salaried, at some point in time we need quick arrangements of cash for various kinds of emergencies. In this situation, a personal loan acts as a real savior. In personal loans, people generally borrow a requisite amount of money from an institution such as – bank or any moneylender so that he or she can pay for what they need.
Living in a rich state like Singapore can cost a lot of money. In this scenario, a low-interest personal loan in Singapore may be put in service for a wide range of expenditures, including emergencies of self or family members, medical treatments, debt payments, foreign travel, business expenses, wedding expenses, educational expenses, and so on.
Take some time to read this article to learn what a personal loan is all about, and when you.
What Is A Personal Loan?
A personal loan is an unsecured borrowing from a financial institution. It is called “unsecured” as it is nobobound to collateral. It means that the lender can’t get the authority to seize your assets if you are unable to pay back the amount.
Advantages of Taking Personal Loan
- Personal loans are the best option for people who want urgent funds for a large purchase. Online technology makes it fast and easy to process, approving and collecting your desired loan.
- The versatility feature of personal loans makes them easily adoptable by the applicants. You can apply for many purposes, such as – medical treatment bills, car repair, a dream destination tour, debt repayment, and many more.
- You can apply for a personal loan from licensed moneylenders with a lower scale of annual salary also.
- Your request for a personal loan can be accepted with a bad credit score as the lenders verify your capability to repay the loans.
- For the most responsible customers, personal loan rates levitate within 5 to 6 percent. As interest rates are fixed, your monthly payment will be the same.
- The biggest advantage of taking a personal loan is that you can choose from a variety of lenders offering personal loans, be it banks, online moneylenders, credit unions, or any financial institutions to find the best rate. Once you find a loan at your intended interest rate, receipt of your fund takes only a few working days.
How does Personal Loan work in Singapore?
Personal loans can be borrowed for pretty much whatever you need. It is a great way to boost your liquidity to pass by applying for a short term or long term personal loan in Singapore. Personal loans sometimes carry discredit, but if you know how to take advantage of promotional offers, including low-interest rates, it will work well for you.
When To Take Personal Loan in Singapore
Personal Loan in Singapore can be utilised when in difficult situations like delayed repayment or any medical emergency. Never opt for an amount beyond your needs. Do remember, never use personal loans for betting, gambling, or unreliable purposes. Always use the cash loan for your financial requirements.
How much amount can you borrow from a Personal Loan?
You can borrow almost 2-6 times above your monthly income or a maximum amount of $200,000. Keep in mind that the accurate amount of your borrowings oftentimes depends on your credit score or other existing facilities.
Are you qualified for a Personal Loan in Singapore?
Inhabitants of Singapore, permanent citizens, and foreigners can all apply for a personal loan. The basic requirements of applying for a loan are distinct for every category.
- For Singaporeans, the annual earning must be at least $20,000.
- For individuals whose annual income varies from $20,000 to $30,000, their interest rate will be higher than Singaporeans whose earnings are $30,000 and excess.
- Foreigners with an annual earning of at least $40,000 will be eligible for applying for fauna or personal loan.
How to Apply
The following documents will be required if you apply for a personal loan.
- Photocopy of your National Registration Identity Card (NRIC) for the Singaporeans. A valid passport and employment pass (6 months’ validity) will be required for the foreigners.
- Income proof ( E-Pay slip) for salaried persons or latest Income Tax Return proof
- For self-employed, lenders need the last two years of Income Tax Assessment Notice.
How long is a personal loan valid?
Personal loans or term loans can range from 1 to 7 years. The longer the term period, the lower will be your monthly payment. But more interest will be incurred.
What is the lowest interest rate on personal loans?
Banks make periodic revisions on their loan interest rates from time to time. The interest rate of a Personal Loan ranges between 6%-15% per annum. However, promotional rates are also offered by banks.
For getting the maximum benefit from the loan, consider the following factors before applying for a loan:
- Apply for a personal loan only when you desperately need financial help. Taking a loan means incurring more debt in your head.
- You can acquire personal loans from money lender Singapore from two categories, which are secured and unsecured. To acquire a secured personal loan, the borrower needs to provide some security deposit like car title and property title. Unsecured loans are mainly based on a person’s credit score and capacity to pay. Usually, unsecured loans have a higher rate of interest.
- The most important factor in acquiring a personal loan is the interest rate. A lower interest rate is always the best. Yes! It is true if you want to borrow a large amount.
- Also, be attentive to whether any processing fees are involved, how fast you can get your money, and the monthly installments for repayments.
Please keep in mind that banks will do the requisite background checks, so your application for a personal loan can take a few days. Even banks that give “instant approval” advertisements are also limited by some validation period for authenticating the information you will provide to them.