A personal loan is one of the most commonly acquired loans in Singapore, and it refers to taking an unsecured loan from a financial institution or licensed moneylender. This is because personal loans can be used for many purposes, such as renovating your house to purchasing a brand-new car and more.
However, obtaining a personal loan with instant loan approval in Singapore is dependent on various factors, such as the borrower’s income, credit score, etc. For example, having a better credit score increases your chances of getting your loan request approved. To ease the process of getting a personal loan, here are four tips!
1. Familiarise yourself with common terminologies
When going through the terms and conditions of the contract, you might come across languages that may seem somewhat foreign. Here are the three most common terms:
- Interest Fee: This is the amount that the lender will charge you in exchange for providing a loan. It will usually be shown as a consolidated amount per year, even though it’ll be applied monthly to your repayment amount.
- Monthly Installment: The amount that you need to repay per month is referred to as the monthly instalment, and it includes the principal amount and interest fee. The frequency of monthly payments required along with the amount needed per month will be determined at the start of the loan – and it also differs depending on your moneylender.
- Processing Fee: The processing fee is the amount charged by the lender for carrying out the work needed to provide the borrower with the loan. It can be charged based on a percentage of the loan or at a fixed rate and is usually paid at the start.
2. Consider the amount of money to borrow
Based on your monthly income, consider how much you need to borrow. Often, a higher amount of money borrowed would lead to a higher interest rate paid per month. So before you apply for a loan, calculate how much you’d need to repay after obtaining the loan, and determine if you can manage it.
3. Choose a loan that suits your needs
There are four types of personal loans available: unsecured loans, secured loans, medical loans and debt consolidation loans. Base your choice on your situation and take your time to ponder upon which is the right fit for you.
4. Weigh your options between the various licensed moneylenders
Different moneylenders offer different loan requirements. Before committing yourself to a loan from a moneylender, you should research the different licensed moneylenders available and go for the one with the most favourable terms.
Consider carefully before agreeing on any contractual term. Ask the moneylender questions if you have any doubts. You can even get a lawyer to help read through the terms in the contract. Once you’ve settled on your preferred moneylender, clarify what documents are needed so you can prepare them for a fast loan process. Usually, the basic documents required are a copy of your NRIC, pay slips and proof of employment.
We hope the tips listed above would be of great help to you. If there’s anything else you’re unsure about, feel free to contact our friendly team at Easyloan. Better yet, sign up for a membership and discover the wide range of benefits we have in store once you create an account!