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Personal Loan Myths: Why You Shouldn't Believe Them - #1 Loan Directory in Singapore | Loan Singapore

Personal Loan Myths: Why You Shouldn’t Believe Them

When you are need of easy and fast cash, yet you have a certain misconception about the personal loans available in Singapore being offered by a licensed moneylender, then this guide will help clear things up for you.

Licensed moneylenders in Singapore offer personal loans and are often the last resort that customers in need of fast cash turn to. Many borrowers do not make use of this credit option available to them and thus prefer to cash advance withdrawals available using the credit cards.

By having access to this type of an instant cash loan, you are able to fund any emergency need in the ranging from S$500 to S$100k. The repayment schedule agreed upon on the loan contract is often very flexible and you will be expected to pay a low personal loan interest percentage rate each month.

In case you are still reluctant to take such a personal loan credit, read on to identify whether your reluctance and unwillingness may be attributed to one of the below listed common myths regarding personal loans applications in Singapore.

Myth 1- The Application Process Is Complex

This myth is far removed from the truth. The loan application process in Singapore is easy and can be done online from a licensed moneylender. What you will be required to present to the licensed moneylender is the correct and necessary documents and later all the proofs in person at their bank offices. This will enable the loan approval and processing of your loan application be done in a fast manner. Once your loan has been approved, you will then be able to access your loan amount in a little less than an hour from your bank account.

The online loan application process is simple and easy to understand and takes a short time to fill out the online application form. Thereafter you will attach the documents required then you will be required to present the original documents in the legally approved moneylender’s offices for verification.

Myth 2 – Singaporean Personal Loans Are For Salaried People Only

If you are self-employed, a professional or a contract worker, the personal loan is equally intended for you. You can access this loan type being offered by licensed Singaporean moneylenders.

What you will be required to present to the licensed moneylender of your choice, is the relevant business details and employment details, a recent bank statement, valid Singaporean pass details and proof of residency and any other vital documentation the moneylender may require.

Personal loans are accessible to all people provided they present the money lender with business details, a Singaporean identity card, proof of address and any other documentation the licensed money lender may require from you.

Myth 3 – Purchases Made Using A Credit Card Are Cheap In Singapore

Your credit card will provide you with a higher credit limit, but the charges on interest are a lot higher on the repayment amounts. When you borrow from a licensed moneylender in Singapore, you will get to enjoy lower interest rates.

The new licensed moneylender rules stipulate that you will only be charged rates not exceeding a 4% monthly interest rate. Make sure you take time to compare the rates of repayments being offered on your credit cards with those of a Singaporean legally approved money lender. This will help you settle for a loan plan that best suits and addresses your needs as well as one that will not cause you any financial strain during the time of repayment.

Myth 4 – Personal Loans Require You To Have A Form Of Security

Whereas banks will insist on you having a form of security to act as collateral for a loan of larger amounts taken, a private licensed money lender in Singapore will extend a loan to you without asking for security.

This makes the approval of the personal loan much faster as long as you can prove you hold a sustainable source of income to help come up with the monthly repayment amount. Your being able to prove that you are able to make monthly repayments to help reimburse the loan amount taken will determine its approval.

Myth 5 – Existing Loans Debt Affect Your Eligibility For A Personal Loan

In case you are afraid of your loan application being rejected because of an existing home loan debt, licensed and approved money lenders in Singapore will not throw away your loan application because of an existing loan debt.

Singaporean legally approved money lenders will then go ahead and offer you a smaller loan amount even when you owe a large loan debt. Your credit score and history does not affect your loan application approval in any way. Licensed moneylenders are there to help you have access to quick cash to help meet your emergency and financial commitments.

Myth 6 – A Borrower Needs Good Credit Scores To Qualify

In Singapore, credit scores and records are especially important for banks. On the other hand, a lower credit score will not stop you from accessing a personal loan from Singaporean licensed moneylenders. The legally approved Singaporean moneylenders are less likely to reject your loan application because of a low credit score unless you hold a history of defaulting on your payments.

Myth #7 – Focus On Interest Rates Offered

It is important for you to check the interest rates being offered on the loan you have applied for; it, however, should not be the determining factor. The personal loan comes with many other charges which include administration fees, interests on missed repayments and charges on late of payment of monthly fees.

Ensure you read through the charges on the personal loans you intend to take and ask the loan officer of the institution for clarification should you have any questions. This is to ensure you fully understand the terms and conditions of the loan you are about to take. Ensure you confirm whether there are early repayment charges as some licensed moneylender even charge penalties for any early settlement since they lose interest in the income.