Some ask to get married, choose to buy a new car or the latest smartphone model. In the summer some ask for a personal loan to go on vacation. Nobody likes August in the city. The banks know this and, with the excuse of smoothing the hair of the customer, they promote greedy loans thanks to the relationship of trust and longevity. However, the bank where we have the current account does not always reserve the best loan conditions for us. To safely swim in the sea of personal loan offers, we have compared what the market offers for you.
It is extremely annoying when you don’t have enough money in your account. Because then you have to do without a washing machine or car for a while or you can’t start the long-awaited trip after all. To avoid these situations, it may well be advisable to use the services of an online bank. There you can often get money immediately without credit. However, because there are many providers, it is worth comparing the respective conditions. However, this time-consuming task can be done by an online service provider. This lists the most interesting offers and provides relevant information such as the possible loan amount and the annual interest to be paid.
FIND THE BEST LOAN FOR YOU
However, if you are looking for a loan, you must also know how to move between rates, documents, and various information. Here are some simple explanations and some useful tips to learn to see more clearly.
The APR, the reference value
It is difficult to stay afloat between percentages, rates, and acronyms like APR and TAN. But if you choose to apply for a legal personal loan in Singapore, you should understand what it is all about. The APR is the synthetic indicator of the cost of the loan consisting of two items:
- the expenses that the consumer must incur to obtain and pay the loan;
- the TAN, that is the nominal annual interest rate.
It is precisely the total value of the APR, therefore, that will have to guide the choice of the legal personal loan in Singapore and you will have to keep in mind other conditions about this rate. If you choose not to rely on your bank and borrow from other banks that lend only to their customers, you will be asked to open an account with them. Remember that the cost of the current account and stamp duty must, by law, be included in the APR. Also do not be fascinated by advertisements in which the APR is relegated to a footnote: check the reported value, also using our APR calculator.
Borrowing money from a legal money lender has several advantages over borrowing from a traditional financial institution. First of all, there is the reduced time required to apply for the loan. If you want to take out a loan from a bank, you first have to make an appointment with an employee, then go to the branch and bring the relevant documents with you. If documents are missing, you have to come back another day, and the already relatively long processing time is additionally extended. Insignificant contrast, applying for a loan from a licensed money lender is quick and easy. You simply enter your data in a form on the provider’s website, upload the relevant documents, and the application will be processed within a very short time. Most online financial institutions state that they respond to a potential customer’s request within 24 hours.
The legal personal loan in Singapore from an online provider is also tied to relatively manageable conditions. The potential customer must be at least 18 years old and have a permanent residence in Singapore. In addition, he should have a steady income and be debt-free. It is therefore very likely that the financial institution will require one or more current payslips or other proof of income. It usually obtains information about the creditworthiness of the interested party from the credit score However, some companies do without this and also grant a loan to people who would not get a loan from a classic bank due to a negative credit score.
Which online money lender you contact depends on several factors. For example, the amount of money you want to borrow. Some companies prefer to grant mini-loans, i.e. relatively small sums that often amount to only a few thousand dollars. The term of the loan is correspondingly short, often just a few weeks or months. Another online money lender also lends larger amounts, some of which are in the six-digit range. These are preferred by people who want to buy a new car or build a house. The effective annual interest rate, i.e. the proportion of the amount that has to be repaid to the company per year, is also relevant for the use of an online loan. The interest rates differ significantly in some cases, so a comparison is urgently needed.
Some tips to avoid making mistakes
Your goal is to get a legal personal loan in Singapore in the best conditions and without scams. Take advantage of all the tools that can help you to make comparisons:
- before entrusting yourself to any market operator, check that it is registered in the register of the Ministry of Law Singapore.
- ask for a copy of the loan agreement before signing. It is your right, free of charge: no economic or legal condition can be applied if it is not written on the contract, so read everything carefully before signing it;
- if the financial company or money lender forces you to buy its policy to provide the loan it makes an unfair practice, you can report it to the Ministry of Law Singapore.
- a broker or financial agent often charges commissions for their brokerage or consultancy business. However, the remuneration must be treated and communicated to the customer before the conclusion of the contract and must therefore also be in writing;
- try to avoid as much as possible the operators who ask you for a fee in advance, before the loan is disbursed. In some cases, it can also be provided that the expense remains with the intermediary even if it has not disbursed the loan. And here comes the possibility of a scam. We are told that in some cases the commission is immediately paid even if in reality the broker knows for sure that the loan will never be disbursed. In these cases, we are faced with incorrect and illegal behavior that can be reported to the Ministry of Law Singapore.
Early termination: zero commissions
By law, those who obtain a personal loan always have the possibility of paying it off early. The early repayment commission is equal to a maximum of 1% of the repaid capital and a maximum of 0.5% in the last year of the loan. It is envisaged that the remuneration must in any case be fair and justified and will not be applicable for variable rate loans and those with residual capital equal to or less than 10,000 dollars. It is not true that in these cases a commission for early termination must be paid. If you have any problems, send a complaint to the bank/finance company: they must respond to you within 30 days of receiving it, if they do not or you receive a negative response, you can appeal to the Ministry of Law Singapore.