on Oct 15, 2020
For first-time borrowers who require a loan, their first instinct would be to simply search for the cheapest personal loans in Singapore. However, finding the right personal loan goes much further, such as learning about various imposed fees, the maximum amount one can borrow, and essential documents for a swift and easy approval. Here’s what you need to know when applying for a personal loan in Singapore.
Before applying for a personal loan in Singapore, remember that you are expected to fully service the loan as stipulated in the contract that you will eventually sign. It helps to start things off by assessing your purpose for taking out a personal loan. Do you need a smaller sum to service an unexpected payment? Or do you envision requiring a larger sum for a bigger expenditure, such as renovation fees that can hit tens of thousands?
Most licensed moneylenders offer a range of other loans that may help your specific needs better, such as payday loans or business loans. You can seek a licensed moneylender’s help to come up with a realistic and achievable repayment plan for your personal loan. You will also need to estimate the amount you can loan at once. Licensed moneylenders can loan a maximum of $3000 for borrowers with an annual income of less than $20,000; and can loan up to 6 times one’s monthly income above the $20,000 mark.
Once that’s done, you can start your search for cheap personal loans in Singapore. Note that licensed moneylenders are legally required to charge a maximum of 4% interest per month, so do be wary of illegal lenders who may offer larger sums but beyond 4% interest. Once you have shortlisted the most attractive options, it’s time to drop them a call or email to inquire further before arranging a physical meet, if required.
Also, be aware of what licensed moneylenders are allowed to charge. Many people seeking cheap personal loans have paid dearly due to a lack of awareness of hidden fees. A licensed moneylender is only permitted to impose certain fees, such as a fee not exceeding $60 per month of late repayment, a service fee of maximum 10% of the loan’s principal upon approval, and legal costs to be borne by the borrower for the purpose of recovering the loan. Do note that the combined fees of interest, late interest, administrative fees and monthly late fees cannot exceed the principal amount being loaned too.
To make your personal loan a smooth affair, do prepare your essential documents and personal details to streamline the loaning process. Singaporeans and PRs will require their NRIC and Singpass details, while foreigners will need to bring their passport, proof of residence such as bills with one’s address on it, proof of employment such as work permits, and proof of income such as payslips. Get your loan approved within 30 minutes, and you’re on your way to greater peace of mind.
Sounds tedious and complex? Drop R2D Credit a call or email today, and we’ll walk you through the whole process to get the swiftest and cheapest personal loans in Singapore!