Personal loans are multi-purpose funds. They can cover any costs, from medical bills to housing, from travelling expenses to renovations, and for emergency purposes. They have a fixed interest rate and are repaid in instalments. Personal loans can be secured or unsecured loans, with unsecured loans being the most common of the two.
Personal loans moneylenders will consider certain details before granting the loan, such as credit score, proof of income, and debt-to-income ratio. While you may be advised not to take any loan so that you can lead a financially healthy life, there are instances where a personal loan can help you through difficult financial situations.
Here are 7 reasons why a personal loan could be suitable for your financial needs.
If you require funds to aid you in covering multiple expenses, a personal loan offers versatility which can be used for many different specific purposes. Hence, you will not find any limit or restriction of needs when it comes to personal loans. You may also apply for small or large funding, depending on your needs.
2. Fixed interest rates
With a personal loan, borrowers need not worry about fluctuating interest rates that may amount to high overhead costs. Most borrowers seek loans with fixed interest rates throughout the loan term, and a personal loan provides the funds upfront without any changing interest rates. Borrowers will also repay the loan in fixed instalments every month.
3. No collateral
Collateral is a form of protection that is given by the borrower in the event that they default on the loan payment. Secured loans typically ask for a form of collateral, while unsecured loans do not require any. As unsecured personal loans are the most common option, it is ideal for borrowers who are looking to take out some funds and have no asset of value to put down as security. Without the need for collateral, unsecured personal loans are a risk-free financial solution for borrowers.
4. Wide availability
Personal loans are one of the most popular financing options for a borrower. Hence, you will find many financial institutions, like banks, credit unions, and licensed debt consolidation companies in Singapore offering personal loans. Before taking up any loan, borrowers should compare the terms that are provided so that they can decide on the option with the best offer.
5. High limit
Personal loans have a high financial limit to the amount of money that borrowers can apply for. This makes the loan suitable for multiple purposes as they are offered to borrowers in small and large amounts. However, factors like your income and credit score determine whether you qualify for larger funding.
6. Extended payback term
There are several payback options available for personal loans. The duration ranges from as short as one year to the next few years. Borrowers who are looking to obtain funds and may not have the capacity to repay their loan in a short time can opt for a longer repayment term.
7. Fast approval
When obtaining a personal loan, borrowers can be sure of a quick loan application. When compared to other loan types, personal loans do not have a rigorous application process. If you meet the requirements for the personal loan, the licensed moneylender will approve your loan application, and you will see that the funds are credited to your account, sometimes as quick as within 24 hours.
If you are looking for a loan to tide you through tough financial situations, you can check out for a moneylender at Hougang stops here. We offer many low-interest loans that you can use to pay off your debts, bringing about financial stability in your life. Contact us today for your cash needs.