With the emergence of the Covid-19 disease, which struck the entire world in early 2020, every person faced a huge financial burden due to lockdowns, restrictions on travel, and economies drastically falling.
The economy has since tried to revive, lockdowns lifted, and people are looking for ways in which they can make a coin out of their businesses to recover from what they already lost. One way that has been adopted in the entire world is by borrowing personal loans from financial institutions and moneylenders who are in the business of supporting financially.
Therefore, a personal loan is the amount that lenders disburse to the borrower’s account either for the long term or short term, paid in monthly installments, and charged a certain amount of interest monthly.
In most cases, personal loans are unsecured loans and their repayment period varies from two to a maximum of seven years. This is dependent on one’s ability to repay the loan.
Singapore, being a world business hub, has seen it all when it comes to borrowing money to cater to the individual’s short-term or long-term investments. This ranges from emergencies, school fees, hospital bills, and many others. There’s no need to worry since many financial institutions render these services if you are a Singapore resident.
Some of them are;
- Banks
- Moneylenders
- Virtual banks,
- Online financial institutions and the like.
However, it is imperative to understand how each of them operates, and depending on the urgency of the loan, one can make a well-informed decision on how to handle them.
In the case of banks, they are the traditional financial providers who, from time immemorial, have continued lending personal loans in Singapore. However, there is a lengthy process involved in the entire moneylending process.
The other commonly used institution in Singapore is the Moneylenders. These financial institutions are regulated and licensed by the ministry of law to operate the financial lending activities in Singapore so long as they abide by terms and regulations that govern the disbursement of loans.
Since there are many of them, there is a need to research and ascertain the legitimate moneylender to avoid being scammed by the so-called loan sharks. Their main aim is to manipulate people who need financial assistance within the shortest time, but they end up charging high-interest rates that are almost unbearable.
Such organizations do not have a physical office advertise using emails and SMSs, and these are the first signs that one can smell that the institution is operating illegally.
However, there are positive characteristics that one should look out for when searching for a good money lending institution, and some of these are detailed here below.
- The Cost of borrowing a Personal Loan- It is indeed true that everything comes with a cost. Likewise, obtaining a personal loan in Singapore comes with a cost: the interest rate. For a legitimate moneylender, the interest rates are regulated by the ministry of law in Singapore, such that the borrower’s rights are protected.
This is one of the green lights that one should look out for. Login to the government website and find out the interest rate to determine if the company is operating within the specified limits before entering into any contract.
- Loan Tenure– A specified period is set. Still, it can be negotiated between the borrower and the lender to give room for the lender to see if they can pay within the stated time frame comfortably.
- Terms and Conditions Revealed- When it comes to a legal money lender in Singapore, the owners take the borrower through the entire terms and conditions pages to ensure that the borrower is fully aware of what they are about to sign for a while borrowing a personal loan.
All these and many others come in handy when ascertaining the legitimacy of the moneylender. One of the best moneylenders in Singapore who has fulfilled these conditions and earned an excellent reputation in the country is Avis Credit Pte Ltd.
This is a well-known moneylending institution offering personal loans in Singapore and has diversified into other types of loans such as debt consolidation loans, home improvement, refinancing loans, medical bills settlement, and many more.
To learn more about this, visit https://avismoneylender.com for more information.
Besides these, all types of loans have their pros and cons and so do personal loans
What are the Pros of Using a Personal Loan?
- Flexible Repayment Schedule
Once the funds are approved and disbursed into the account, the borrower enjoys the liberty of using the monies most appropriately and conveniently. For instance, if it was meant for debt consolidation, the borrower will pay off the debts and pay the installments at ease. This eases the burden of paying substantial monthly obligations, making life more bearable.
- The Freedom to use the Funds- Personal loans are not restricted to a specific need like an asset finance loan, where one must buy the asset in question. This gives the borrower the freedom to use the money whether paying for school fees partly, going for a holiday, or any other need.
- Fast Loans Approval- Personal loans enjoy first approval, and within 48 hours, the money could easily land into the account ready for use.
However, there are cons related to personal loans, and these are:
They are high-risk loans– Personal loans are indeed high-risk loans of the fact that they are unsecured and can be used for a different purpose from what it was initially meant for.
But then, if used well, personal loans have seen many people improve their credit rating and opened doors to higher loan limits and low-interest rates.
What are the Considerations to put in Place before going for a Personal Loan?
Some of the considerations that one should always keep in mind are;
- Manage the finances wisely- This is done through discipline. Unless otherwise, use the money for the purpose that it was meant for to avoid default at a later date.
- Plan Ahead of Time– Before making an application, plan and see if it will be a material effort to borrow the loan.
- Use the Right Channel of the Financial Provider– Since there are many financial providers, research wisely and work with a legitimate moneylender to avoid future regrets.
With this information, you should be sure of getting the best of a personal loan in time of need.
