Today, taking a personal loan in Singapore has gotten misleadingly basic and alarmingly mixed up simultaneously. Out of every single type of loan, Personal Loans feature this unusual trademark the most. Indeed, even to conclude that you need a Personal Loan can be a difficult job. However, when you do conclude, there are still enough factors you ought to consider and look at before shutting on your loan.
Some people might take personals loans for their education; some may take them for their wedding; some may plan on going on their dream vacation but don’t have the requisite amount of money in hand. Why give up your dreams when you can easily get a personal loan?
There are few factors that one needs to peruse before picking a Personal Loan. To be more specific, there are few questions you need to ask yourself before taking a personal loan.
Things you should know:-
How much money do you need?
It is perhaps the essential thing you should know without a doubt before applying for a Personal Loan. The lesser you acquire, the faster and more effectively you can take care of your Personal Loan. Under ideal conditions, you ought to borrow just the most requisite sum while making different courses of action for the rest. Additionally, you should check the maximum personal loan amount given by the bank under certain circumstances.
What could be your interest rate?
Interest rates influence your instalment amount and, here and there, even the length of your loan repayment period. Today, a wide range of loan providers have a significantly more extensive scope of interest rates accessible. You ought to do your exploration to track down the interest rates. Your interest rate relies upon various parameters, including your credit score, loan amount, and payback period. Interest rates can be pretty much as low as 3.49% and as high as 29.99% or, in few cases, even more. Ordinarily, you’ll get the most minimal interest rate when you have a decent credit score, and you pick the shortest loan repayment term period.
What would be the payback period?
The repayment period is when you take care of repaying your principal amount of loan and interest part. It is ideal for keeping the repayment period as short as could be expected. On the other hand, the twist is that as you wish to shorten your repayment period, the regularly scheduled payment sum keeps going up. In most cases, you will need to start paying the loan back to the organisation in regularly scheduled payments, usually within 30 days. Most lenders give a payback period between a half year and seven years. Both your interest rate and regularly scheduled instalment will be affected by the length of the loan payback period you pick.
Are you eligible for the loan?
This question might sound obvious, but when you apply for a personal loan in Singapore, eligibility criteria are the most important factor that you need to tick off before getting a personal loan. The general eligibility criteria are:
- You have to be 21 years old.
- Your annual income should be greater than or equal to a specific amount. This amount may vary from bank to bank.
The next thing that arises into your mind is what if you don’t tick off the eligibility criteria? Does that mean you are not getting a loan?
Well, if banks do not approve a personal loan, don’t stress. There are authorised lenders with less stringent measures.
The lender you are choosing is registered or not?
Earlier, selective banks with numerous branches were the only reliable lenders from whom you could get a personal loan without any concern. However, today there are more straightforward and more helpful choices with the changing of time, where one can easily avail of a personal loan. But, whoever is the lender that you decide to get your loan from, there is one factor that you should always check, i.e., whether you are getting the loan from a registered money lender or not.
When do you need the funds?
Most of the lenders approve the loan and delivers you the personal loan principal amount on the same day. However, there could be lenders who could take up to 10 business days to deliver the principal amount. Sometimes, due to certain circumstances, the process could take more than time. So, if you need the fund in your hands as soon as possible, make sure the lender offers you fast service.
Do you have a decent credit score?
Before you begin applying for personal loans, it’s essential to check your credit score to ensure you can qualify. Most personal loan moneylenders are searching for candidates to have a decent credit score, especially online banks. Be that as it may, on the other hand, if you are currently an existing customer of any bank, you may get approved for a positive arrangement of loan having checked that you have a decent history of covering bills on given time and respecting the provisions of your past loans and records.
Do you need to pay any fees for the personal loan?
Personal loan banks may require an expense; however, most don’t charge any charges other than interest. A start expense is a one-time charge that your bank takes away from your loan to pay as a processing fee. It’s normally somewhere in the range of 1% and 5% of the principal amount, yet it is charged free in some cases.
Conclusion:-
Personal loans are a great option to avail when you have a lump sum to spend but don’t have the amount in hand. But, personal loans should get treated like any other financial product. In order to get the benefits, you need to have a proper plan. Ask yourself the above questions thoroughly. Do your own research. Try to know about the credibility of third-party lenders. Most importantly, check your eligibility criteria and choose your lender accordingly.