You could be in need of some money but asking your friends and family might get you awkward, then you are left with another option of going to the bank and getting yourself a personal loan.
But before going to the bank and applying to get the best personal loan rates in Singapore, here are a few things that you need to keep in mind which include:
- A term loan is known as the fixed sum of money with a fixed plan for the payment, which you need to abide by before you get your cash. These are advisable since you can pay them back slowly and you also pay a lower rate of interest.
- There is also something called as a personal line of credit which is the approved amount of the money which can be cashed out as a part or as a whole. But the drawback in this is that you need to repay these as soon as possible if not then you will have to pay a very high rate of interest.
- The usual tenure of the loan will be from 1 to 7 years and you will have to see how to work on this tenure and be committed to it too. You should go in for the shortest tenure in which you can minimize your interest but don’t get over worked up and see that your monthly instalment is within your zone of comfort.
- Citi Ready Credit Paylite: if you plan on borrowing a larger amount, you need lower rates of interest when repaying them. Citi is offering lowest rates of interest on personal loans in Singapore. If you are a new customer then applying for a loan with this bank with a 3 year loan will give you an interest rate of 4.27% per annum. The eligibility for this loan is that you must be a resident of Singapore or PR at least 21 years of age and your annual income has to be at least S$30,000.
- HSBC Personal Loan: this provides a rate of interest of 3.70% for a 3 year loan period. The HSBC Personal Loan offers the longest tenor on the loan in the market. You can also spread your payments for over up to 7 years. In order to be eligible for this loan you will have to be a Singaporean and will have to at least have an annual income of S$30,000. The maximum amount that can be borrowed by you is capped at 4 times your monthly income.
- CIMB Cash Lite Personal Instalment Loan: this offers you a personal instalment loan with good rates of interest. The low rate of interest is being offered depending on your credit rating. But if you have been paying your bills on a regular basis and keeping your unsecured balances low this could add as a plus point for you and just help you qualify for the lowest interest rate. In order to be eligible for this loan plan you will have to be at least of the age of 21 and with an annual income of S$30,000.
What are the important documents you will need while applying for a loan? Along with your personal loan application form you will have to provide some more documents which will include the following:
- The proof of your income
- Your address proof documents
- Your proof of identity documents
- The certified copies of license or a degree
Here are a few terms involved in the loan system:
- Part payment: this is regarded to the amount which is less than the full loan principal amount is mostly done before the due of the loan amount.
- Pre payment: this pre payment amount may not necessarily be equal to the amount which is due. Pre payment is when you pay your loan in a part before it gets due according to the EMI system.
- Pre closure payment: this is when you completely pay off your personal loan before the loan tenure has ended.
Mentioned below are a few benefits of personal loans:
- No end use limitations: the personal loan can be used for any purpose at all, there are no hard rules for its use. Personal loans seem to be the easiest way to get cash when you are in need of it.
- There is fast and easy disbursal: if you fulfil the criteria that is required and your credit score is good too, then you can even avail your personal loan in the time period of 72 hours. Some of the banks also provide the online facility of approval of the personal loans.
- Collateral is not needed: it being an unsecured loan it is very easy to get it and there is no need for any collateral.
- The benefit of the tax: you can avail the tax deduction if you are using the personal loan money for renovation of the house, or for the construction. But you will also have to provide the necessary documents which will prove that you are using that money for the mentioned purpose itself.
- Fixed interest rate: personal is made available based on a fixed of interest that will remain consistent for the entire loan tenure and there is no need to worry that the rate of interest will change.
- You can choose the tenure: the loan tenure will go up to 7 years and hence you can choose which tenure will be suitable for you. The longer the tenure the lower will be the EMI and vice versa.
- Helps in boosting your credit score: the types of accounts that you have used, this helps in counting towards your credit score.
What is the benefit of a personal loan over a credit card loan?
In a credit card loan you will be able to avail it on your card but this loan will be applicable only on certain cards and if you want a loan on it you will have to approach the card issuer but while considering a personal loan any lender of your choice can be approached to.