If you want the lowest interest rate personal loan Singapore, then instead of going with the vernacular method of money lending that is banks, opt for licensed money lenders. They will not charge more than 4% monthly, are trustworthy and will provide and approve loans faster when compared to banks.
You can compare the rates and choose the best personal loan rates Singapore online as well as offline. Let us first discuss how personal loan works.
How a personal loan actually works?
Once you fill out an application form for requesting to lend a personal loan, the money lenders or banks review your application and approve it within a day or two. You will receive money in a lump sum for months or even for days depending on the urgency of the situation. Then it will be your turn to repay the loan amount which is a certain interest which you chose to pay upon. Personal loans are of two types: secured and unsecured loans
- Secured loans: these types of loan demands you to put up collateral, for example, if you want to borrow money then you will have to keep something at stake so that in case you are unable to repay the loan, the bank or licensed money lender will seize your property or valuables which you kept at stake.
- Unsecured loan: these types of loans do not make you put up collateral but will definitely demand you to have a higher credit score limit. In case of any dispute or you not being able to repay the loan, the moneylender or bank has all the rights to file a complaint against you and you will always have the risk of being sued.
But there are situations wherein you can receive a personal loan even faster. Though there are separate specialised loan plans available for all the life events, people still opt for personal loans. This is because personal loans give faster approval, have minimal documentation, etc. which is missing in all other types of loan. But one should keep in mind that personal loan is a generalised loan which can’t provide as many facilities as a specialised loan will provide. However, if you still wish to continue with a personal loan, here are a few ways wherein you can use a personal loan as an alternative.
- An alternative to a payday loan: if you are stuck with your credit card bills because of financial hardship, then you might consider taking a personal loan for that. It is not advised to do so but can be the last option as credit card debts are worst.
- Home renovation: want to fix the dripping ceiling, cracked walls, install solar panels etc. but running short of money, then instead of applying for a house loan, you can go ahead with a personal loan. Personal loans are approved faster when compared to any other type of loan and they do not require tiresome paperwork or waiting for a long time. Also, personal loans will fit you better as they are less risky.
- Moving costs: you may not need to buy a personal loan if you are moving over a short distance, but if you are shifting from one state to another or from one country to another then you might need to get one. Personal loans funds will help you in moving your personal and household belonging to different, new places, or organising old and new furniture in your new house. They will also take care of your transportation or shipping charges. But also keep in mind if you are taking out a loan, for this reason, you should save enough to pay off the debt later.
- Funeral and emergency: this can be hard to digest but in the worst-case scenario, if your spouse or father dies which happens to be the only person earning, then arranging a funeral, paying education and medical aliment fees, basic necessities etc. managing all of this can be very rough. In such cases, personal loans are here to support you and stay by your side.
- Vehicle financing: you can go with a personal loan for buying a new bike or car instead of a car loan. But remember that car loans are specifically designed for the above purpose and might have something better and certain speciality to offer a user which might not be the same case with a personal loan. Car loans will require more paperwork and demand patience but will be worth it in the end.
- Debt consolidation: it is considered as one of the most common reasons why people apply for personal loans. To pay multiple other loans or credit cards bills. In such scenarios try to combine or group all your pending repayment into one and pay them all within a month. People opt for personal loans in order to pay off their bills as the interest rates of personal loans is comparatively low. Lower interest rates reduce the chances of loss and increase the percentage of you being able to pay the loan before time.
- Wedding expense: it’s always a good idea to take a personal loan for events occurring once in a lifetime. One such being wedding function. Your personal loan for a wedding can range from as big as booking a venue, caterers, other arrangements and even bride’s attire, engagement ring etc. to as small as flowers, photographers, makeup artists, music or DJ etc. Arranging all of them will consume your several month’s salaries which might not be handy. In such a case taking a personal loan is the best option available in the market.
Though personal loans can relieve you from any kind of financial problem quickly, there are certain places where you should opt for specially designed and assigned loans for better user experience.