5 mistakes to avoid when looking for fast loans in Singapore
Financial emergencies can never be predicted, and almost everyone faces them sometime or the other. Therefore, the best option is to have emergency funds saved in a separate bank account. Such an emergency fund can come in handy when an unforeseen situation arises such as paying off future debts, medical expenses, financial hardships caused by unemployment as many people experienced during the ongoing pandemic.
However, everyone might not have emergency funds. There could also be a situation where the prolonged illness or the urgent requirement is higher than the amount you saved. In such a scenario, the best option is to get fast loans in Singapore. You need to find the best private money lender in Singapore. While there are unlicensed moneylenders often called loan sharks too, you must be careful enough to take only a legal loan in Singapore.
Fast loans Singapore
Fast cash loans are a type of personal loan which can be availed in cash almost immediately and play an important role in paying for unplanned expenditure. While fast cash loans are similar to personal loans, they can be a quicker option to meet sudden needs. However, they should be used smartly.
Therefore, it is important that before going for fast loans in Singapore, you must understand this type of cash loan in detail:
The benefit of a legal loan in Singapore
Quick access to cash: Typically fast loans in Singapore help you get cash within 24 hours. Thus, they are helpful in meeting urgent needs. Whether you have a personal, medical, or business need, you can quickly take a loan from a private money lender in Singapore to take care of the urgent need. All you need to do is to fill out an online loan application or apply in person at the preferred money lender’s office. The process is fast and easy and once the loan is approved, the amount gets directly credited to your account and you can repay it as per the schedule.
Despite the convenience and speed of fast loans in Singapore, there are certain mistakes that people make while applying for such loans. As a result, they end up suffering more instead of benefiting even after taking a legal loan in Singapore. Here is what you must not do:
Not focusing on tenure: Fast loans in Singapore also usually have a higher interest rate than other types of personal loans. Therefore, you must not deliberately go for longer terms believing that the EMI amount will be low. Because taking a longer loan tenure would lead to higher interest payment and overall cost of the loan.
Not caring for your credit score: While sometimes, the credit score might not matter much, but, when you apply for a legal loan in Singapore, a poor credit score can lead to rejection of your loan application process. Whenever you take any loan or use credit cards, make sure to pay back on time to maintain a healthy credit score. Since fast loans are unsecured loans, the private money lender in Singapore will focus on your credit score to assess your loan worthiness.
Taking a loan for a casual reason: One of the commonest mistakes is to take loans casually just because you are eligible for them. People tend to use loans and spend the money on things like shopping etc. That should be avoided because at the end of the day, the loan is a financial burden and if you fail to pay back on time every time, you would have to pay penalties and you might even become disqualified for future loans.
Not knowing the annual percentage and interest rate: Before applying for the loan, you must carefully confirm the interest rate and the Annual Percentage Rate (APR). Even if the website for a private money lender in Singapore says that it offers flexible interest rates, you must carefully evaluate the details. Annual percentage rate (APR) is about the percentage of the loan amount that will be repaid each year. Various fees such as broker fees, rebates, or closure charges will have to be taken into account to calculate the loan cost. Many times, the borrowers face difficulties as the APR turns out to be higher and forces them to pay more than they had planned. As far as possible try to look for a legal loan in Singapore with a lower APR.
Late payment charges: These days the reputed moneylenders offer fast loans at flexible terms but, late payment invites hefty penalties in the form of late payment fees. That’s why you must always strive to pay on or before the due date. Delay in repayment can not only hurt your credit score but also make you pay the penalties.
After going through all the points above, and carefully evaluating the fast loans in Singapore, if you decide on borrowing from a private money lender in Singapore then you will be in a better position. The information gathered will help you in taking a loan that is advantageous to you.