Personal loans although are very helpful in emergencies, but choosing the correct personal loan vendor (bank or licensed money lender) is a hectic and confusing task. As there are too many agencies or banks selling you several variations of the simple original loan. These variations are very good and helpful as they provide lot of benefits and cover most of your needs, but it is up to you to make a wise decision while choosing a personal loan agency. Not to worry, we have got you all covered in this article.
ADVANTAGES OF TAKING A PERSONAL LOAN:
- Fast processing time: The best personal loan in singapore because they have the fastest processing speed. They don’t make people wait for a longer period of time, just do the required paperwork. It works best for your urgent or emergency needs. You can receive a loan within a time limit of either a day or a week of your application submitted, not more than that. On top of the benefit of getting loans faster, they also provide hustle free processing of paperwork, which implies you don’t need as many papers (as proof) as required in other loans.
- Fixed interest rates: interest rates keep on changing every season. They are never fixed, but with the facility of personal loan, you can count on fixed interest rates. Even at the time of crisis, you can depend on personal loan interest rates, which will not let you down. Unlike credit cards which increase interest rates depending on the balance of your bank account.
- Excellent credit is not required: there are certain loans which demand good credits from you, but it is not so with personal loans. Personal loans can be taken while you have a bad credit score. But there are some lenders whose rate limits exceed 35 per cent and you might need to pay higher than usual.
- You can borrow the required amount: even if you want a few thousand dollars or as much as $ 100,000, a personal loan allows you to do that with certain paper works. This amount might depend on your credit score but if there is a real need, a personal loan is to your rescue.
- Range of repayment terms: many lenders have several ways or options for repaying personal loans. The best place to take personal loan in Singapore. The time period of repayment can be as short as one year to as long as seven years. It is advisable to pay off the amount as soon as possible to avoid multiple interest payments and to relieve you from the pressure of paying the debt.
- Versatility is one of the main reasons for which you may want to go for it. If we go to take any specific type of loans, we need to specify our specific need and for that need, we have to submit some special documents also. Therefore, one loan can be used for one purpose only in most of the cases. However, if we talk about personal loans, they can be used for more than one particular purpose like car maintenance, house innovation, vacation, travel, study and much more. That is the reason many people opt for it.
Along with so many advantages that personal loans provide, here are a few loopholes that you need to be careful of while applying for it.
- Getting trapped in a debt cycle: if you take a loan which you’re unable to repay, and take another loan to repay the first one, then you’re in big trouble. Or if you take a personal loan to pay your credit card bills and are unable to fulfil the loan requirements, it might create a debt cycle.
- Fixed monthly payments are required: you cannot take these monthly payments for granted. You have to be regular while paying your amount off.
- For many of the people, this personal loan can be like a personal invitation for the persisting crimes forever. Many of the fraud people promise people to provide higher valued loans without any documents, low rate and many such things they offer. But the same doesn’t seem to happen at the end. They do so to take crucial information regarding the people. This information they use for many different purposes like taking loans on behalf of you and giving you nothing from that. So loans would be on your name but you will not get the amount issued for that but you have to clear that through repayment. Therefore before you go for any such loans, you also must check about the legibility of the company which is going to issue you the loan.
- Many a time when we go for taking any loan, the loan paying company, bank or the individual agent asks us for some origination fee. This is the fee which is taken as the amount which initiates the process of issuing the loans. Though most of the people get trapped into such a loan taking process, it is not the correct way to get or give a loan. Hence if it is possible, always avoid going with such a requirement. In many of the cases, it has also been seen that the loan promising company or people just disappear as soon as they get the things which they wanted to take from you. Therefore without validating the loan issuing company, you would never say yes for them.
- If you have taken any personal loans and any other type of loans, you must be aware of the differences between the repayments of the loan EMI. In the case of personal loans, you would find the rates to be higher than the rates on any other loans. For the same or equivalent amount. The reason behind this is the no requirement of documents and fast loan processing. Therefore if you could manage to take any other loan for the same amount and higher rates matters for you, it would be better if you choose to go with any other type of loan.
With the above discussion, it’s very clear that a personal loan can be either good or bad as per your degree of awareness about it. If you take it after being fully aware of all the things related to it.