There are four types of personal loan you can apply for in Singapore. Those are:
- Personal Installment Loan– Personal Installment Loan is known by various names in different banks. The basic function of the bank lies the same; borrow a specific sum of money, a processing fee is charged and in the next 5 months, you agree to repay the amount in fixed monthly installments. The interest is calculated on the basis of tenure. A processing fee is charged which sometimes can cost up to $3. The interest rates can vary from bank to bank. An effective interest rate of approximately 7% is charged on the loan amount. Portion advances depend on an accessible credit limit in your advance record or credit extension account. Commonly, the most extreme sum is 4x of your monthly payments. This can go up to 10x of your monthly payments only if your yearly salary is above $120,000 and you have a decent record of loan repayment. It is usually preferred to take up personal loans if your loan amount is huge and you require a lot of time to repay the money. Personal Installment Loan can be taken for up to 12 to 60 months from some company like easycredit.com.sg. If there is any promotional offer going on. , then the processing might be completely waived off or a lower interest rate will be charged.
- Line of Credit– Line of Credit is known by various names like cash line, revolving loan, credit line or flexible repayment amount. Line of Credit only charges you interest at the time of withdrawal of money. This is the best part of the Line of Credit. There is no interest charged until you fail to repay the amount in the period assigned. Banks keep aside a certain amount of money for you to withdraw in case of emergencies. Interest is charged only on that amount which has been withdrawn. There is one major drawback in this form of personal loan. The interest rates charged by banks are very high. It can go up to 18% to 22% p.a. the processing fees charges are also high. The loan amount can be from 2x your monthly salary to up to 6x your monthly salary. There is no fixed period for the repayment. You pay the interest amount only once you fail to pay the whole amount. It is advisable to take up the line of credit form of personal loan only in case of absolute necessity. The more money you owe, the higher the interest rate will be charged. Thus, this form of personal loan should be considered as the last option available.
- Balance Transfer-This advance office utilizes the accessible credit on your Visa. You pay a one-time handling charge and appreciate an exceptionally low or 0% rate for between 0 to 12 months. After this, you either settle the aggregate sum exceptional or you wind up being charged loan fees between 18% to 29%, contingent upon the credit office the assets were drawn down from. A basic fee or a processing fee of up to 1% to 5%. Normal equalization move advances are between least of S$500 yet can go up to 10X of your month to month compensation in case you’re a high salary worker and have a decent record of loan repayment. When you want to invest in some businesses or require a sum of money for medical bills, a balance transfer type of personal loan can be very useful then. It is a kind of new credit card that can be used to pay off the remaining old credit charge expenses. One should take up the balance transfer type of personal loan only if they are completely sure whether they can repay the whole amount in a specified period or not.
- Debt consolidation plan– Debt Consolidation Plan (DCP) is a kind of a lifeline for all the people who face difficulties in repaying off the unsecured loans. It is a government-approved plan where under one scheme all the various open unsecured loans can be easily repaid and managed less than one place. In DCP, all the various loans are taken over by the new bank and are managed under it. An additional fee and charges will be required to pay off. The effective interest rate charged by these banks can vary between 6.7% to 12% pa. If you experience difficulty staying aware of your credit reimbursements and have a lot of obligation, an unpleasant guide being 12x your month to month compensation. An extensive measure of obligation to reimburse is done. It brings down your loan costs, yet also, drives you into a trained reimbursement conspire. Since your different offices are shut or suspended except if you reimburse the entire advance, you are less inclined to aggregate more obligations.
Now that you know all the various types of personal loans available in Singapore, you can do that in the easiest and hassle-free manner. Try applying for a loan from companies like EasyFind.sg.