Taking out a personal loan is a great solution to all kinds of problems. Whether you need urgent cash to settle credit card balances, want to consolidate your existing debt, or are simply eyeing up large purchases that exceed the reach of your current financial situation, most personal loans offered by licensed moneylenders can help.
What Are Personal Loans and How Do They Work?
Simply put, a personal loan is either an unsecured or secured personal loan which you can use for whatever purpose you please – whether that be debt consolidation, covering unforeseen emergency expenses, or paying off existing debts like everyday household bills.
Secured loans will require collateral, such as your home or other assets, to be pledged before you can borrow money, whereas an unsecured personal loan will never require collateral tied to it.
How a Personal Loan Works
Whether you’re using secured loans or an unsecured personal loan, both function in pretty much the same way. In short, you will borrow money you need from your preferred lender, then simply pay it back monthly at a pre-agreed interest rate.
With Raffles Credit, our loan application process looks something like this:
· 1 – Call or Apply Online
· 2 – Visit The Office to Discuss the Loan Terms with the Lender
· 3 – Sign and Receive Your Full Loan Amount That Same Day
You can take out a personal loan with all kinds of financial institutions, from your regular bank account provider to licensed personal loan lenders. If you need money fast, however, it’s worth noting that many lenders like us offer much faster approval times and easier applications than traditional banks.
Key Personal Loan Features
Most personal loans, whether secured or unsecured loans, will come with the following great features if you apply through licensed personal loan lenders like Raffles Credit:
· 1 – Borrow Up to Six Times Your Monthly Income
· 2 – Pay an Affordable Monthly Payment
· 3 – Enjoy a Hassle-Free Application Process
· 4 – Get Your Loan Proceeds Quickly
· 5 – Collateral Personal Loans Optional (Not Required on Unsecured Loans)
· 6 – No Hidden Charges or Fees
10 Reasons to Apply for Personal Loan Funds
Whether you need some additional cash to put toward a large purchase or short term loans to cover unexpected expenses or financial emergencies, here are a few key ways personal loans could benefit you:
1 – Get a Lower Interest Rate Than with a Credit Card
While credit cards can be a good way of borrowing money, short term loans like personal loans typically come with better interest rates.
2 – Boost Your Credit Score
It’s easy to turn a low credit score into a high credit score by using timely personal loans repayments to improve your credit history.
3 – Borrow More Money Than with Other Types of Debt
This is yet another area where personal loans trump credit cards – loans usually let you borrow a lot more, potentially up to six times your monthly income.
4 – Enjoy Dependable Monthly Repayment Terms
Personal loans are almost always installment loans, which means you’ll pay consistent, easy-to-track monthly repayments that help you better manage your finances.
5 – Track and Manage Your Money with Ease
Paying off one single personal loan is much easier than trying to keep on top of multiple credit cards and debts, which is why personal loans are great at helping you consolidate debt.
6 – Collateral isn’t Required
As many lenders offer unsecured loans with great interest rates, you won’t always have to worry about pledging collateral to get your loan.
7 – Take Advantage of Longer Repayment Terms
Lenders like us offer tons of different loan tenure options, ranging anywhere from a few weeks with super-fast payday loans to a few months or even years with regular personal loans.
8 – Get Fixed Interest Rates if You Need Them
Finding a loan with the right interest rate often requires shopping around, but many moneylenders are willing to offer you a fixed interest rate on their personal loans.
9 – Use Personal Loans for Any Purpose You Please
One of the best things about personal loans when compared to other kinds of low and high interest debt is that your borrowed money can be spent on whatever you want.
10 – Approval Super-Fast
Submitting personal loans applications isn’t as daunting as you might think. You can get loan approval in a matter of minutes and even disbursement of funds the same day– even if your credit score isn’t in perfect shape.
When NOT to Use a Personal Loan – Could a Secured Loan or Other Loans Be a Better Fit?
There are a few circumstances in which personal loans might not be 100% suitable for you, such as:
- If you’re trying to avoid additional or unnecessary debt
- If you’re worried about not being able to afford the interest charges
- If your debt-to-income ratio is 36% or more
- If other types of loans better suit your specific financial goals
Don’t forget that from secured loan packages to car loans or even a home equity loan, there are lots of alternative finance options out there for Singaporeans who need them.
Personal loans with fantastic rates are easily accessible to Singaporeans – and can be used for virtually any purpose you please. But be sure to keep in mind, that:
- While a secured loan will require collateral, unsecured loans are always collateral-free and can be obtained from banks, licensed moneylenders and other financial institutions.
- The best personal loans should have competitive interest rates, affordable repayments, and hassle-free applications.
- Personal loans offer tons of amazing benefits, but won’t always be the best fit for everyone, so remember to consider other loan types, too.
If you need emergency funds to cover everyday expenses like credit card debt, or a helping hand to make major purchases, taking out a personal loan with a reliable licensed moneylender like Raffles Credit can help you get your hands on the cash you need.