The loan can help us in several ways, whether it is needed for any important work or you want to invest in your business, a personal loan is reckoned as the best. But, do you know not every person can get a personal loan? The company which is going to provide you the loan considers so many things before approving it. So, it also becomes very crucial for you to choose the best loan provider. It does not just improve your chances for getting the loan easily but also helps you in getting the loan at the lowest interest rates. Here I am mentioning 10 things to consider for the best personal loan Singapore 2022:
- Maintaining a good credit score: a credit score is the representation of your worthiness while you make payments or by looking at your payment history. The scoreboard ranges from 300 to 900 and 750 is considered the ideal score. A lower credit score might not affect your loan approval ratio if you plan to take it from licensed money lenders. But if you are planning to opt for a bank for meeting your loan requirements, then having a bad credit score might be troublesome.
- Comparison between interest rates: since you are applying for personal loans in either of the two systems, you need to go through the guidelines very carefully and get your basics sorted. Know the minimum and maximum interest rates for licensed money lenders as well as banks, read the requirements and the amount and tenure of loan for each of the two. Then after you have decided which system of money lending to go for, start comparing the interest rates of companies. Go always go for the lowest ones, but the one which suits your needs fully. You can also go ahead with checking or reading personal loan Singapore reviews.
- Analyse all fees: personal loan comes with a cost on every tiny step you take further like processing fees, pre-payment and post-payment fees, etc., and it all matters at the end. In such scenarios consider EIR that is an effective interest rate that gives you in-depth reasoning as to where your money is going. Try not to depend too much on AIR that is advertised interest rates which include only the final costs. This will help in supervising your finances efficiently to meet the needs of personal loans.
- Understand your needs and its applications: take note of all your needs and prioritize them according to the urgency, importance, money required (maybe in ascending or descending order). Club the activities you need a loan for and create an estimate of how much money you want to fulfil the criterion and how much money you can spend to buy the loan.
- Your capability of repayment: deduct your daily or monthly expenditures, savings (Know more about Singapore Fixed Deposit Rates), etc., and try to pay the maximum you can. Don’t unnecessarily stretch the period of repayment as the application of interest rates every month might become hard on your pocket.
- Avoid falling for scams: there are companies out in the market who make fake promises of giving double or triple the money within short tenure. Remember there is no shortcut and you have to survive the procedures and government guidelines.
- Customer service: ensure that the bank or licensed money lender that you are choosing to work further with provides good customer service. Ask if you can view the details or track the progress of your loan online and if not online then how to do it. This will give you the freedom to control your loan financing process all by yourself. Along with that, online services will help you with getting answers to your queries quickly.
- The flexibility of repayment: a lump sum repayment facility is needed besides having regular payment of your loan. This can help you in completing the repaying cycle ahead of time. Make sure that you avoid any penalty during the process which generally comes when you miss your monthly instalment. Consult your bank or licensed money lender to know where else and under which situations the penalty is charged.
- The period of loan: the shorter the period, the better it is. Although you will need to push yourself hard to get out of the debt in a shorter time frame, the result is going to be relieving. It is easy to cut your wants for a shorter period and squeeze every penny and decide to repay your loan. An insistence on repaying your loan in a short period is because the longer you choose to pay your loan the longer you have to be burdened with interest rates. And stretching the payment unnecessarily despite having money is not advisable. Generally, a bank or licensed money lender provides 5 years of tenure and it is advisable to complete all repayment within a year.
- Job terms: it is not very important but a lot of banks and licensed money lenders consider your position at a company, how reputed or well known the company is, you’re earning and expenses, etc. If the company you are working at falls under a high-income generator or is very famous, the chances of you getting a personal loan are higher and vice versa. To some extent, it even gives you the freedom to negotiate for interest rates, etc. Your salary also decides how much loan should be granted and for how much longer.
