TOP 7 Things to Know Before Taking a Personal Loan
- To find the best personal loan for your needs, research different lenders to compare their offerings. Surf into interest rates, repayment terms, and loan periods to choose the most suitable option. Checking reviews from previous clients can also help assess a lender’s reliability. Taking your time to research and compare lenders will ensure you make an informed decision, avoid unexpected charges, and make the financial support you need stress-free. Check here for legal money lender
- A good credit score is emphasized by banks
Licensed moneylenders in Singapore may not require a high credit score for personal loan approval. Although a good credit score can improve your chances of lower interest rates and higher loan amounts, many moneylenders focus more on other factors. Demonstrating your ability to repay the loan is the key, and a good credit score can reinforce your creditworthiness in the eyes of the lender.
- Personal loans from licensed moneylenders don’t ask for collateral.
Personal loans are different from Huger loan types as you don’t have to put up your house or car as collateral to secure approval. They’re commonly known as unsecured loans. As long as you meet the moneylender’s requirements and provide the necessary documents, you can go ahead and apply for a personal loan.
- You can still apply for personal loans from a licensed moneylender even if you have an existing unsettled loan.
Many people hesitate to apply for a personal loan because they think having an ongoing loan will automatically disqualify them, but that’s not always the case. Most moneylenders are open to considering applicants with an existing loan, as long as the applicant can show they can handle repaying two loans simultaneously. However, if an applicant can’t prove they can manage two loans, their application might be turned down.
- Licensed money lenders in Singapore are bound by a cap on interest rates for personal loans.
These lenders are regulated, and can only charge a maximum interest rate of 4%. If money lenders exceed this limit, it indicates non-compliance with local regulations.
- The process of applying for a personal loan from a licensed money lender is quick and straightforward.
Many people mistakenly believe that the application process is lengthy and complex due to identity and application verification requirements that could take days or weeks. However, technological advancements have streamlined the process, eliminating manual assessments and enabling faster approvals. With the necessary documentation, the application can be completed in just a few minutes.
- It is advisable to borrow what you truly need.
While loan approval rates are generally high, individuals may be enticed to request more than necessary. However, it is crucial to avoid this temptation as borrowing incurs costs, such as interest rates. Many borrowers overlook the interest charges that can accumulate fast if repayments are delayed. Therefore, it is wise to borrow only the amount needed to prevent unnecessary interest costs.
