Personal Loan: Is It a Good Option for You?

At last, there is some light at the end of the tunnel – we are finally overcoming the deadly COVID-19. As we get back to work or open businesses, it is time to reset everything and rev back to business, but this might require some time as the old supply chains, new friendships, and new realities take effect. All of these activities mean one thing – the need for more funds. If you do not have enough funds, one of the best options might be a personal loan, and we are going to interrogate it to help you answer the big question, “Is it a good option for you?”

What is a Personal loan?

A personal loan is a type of credit advanced to a borrower by an authorized money lender in Singapore in a lump sum and repaid in instalments. Unlike other types of loans, such as mortgages and car loans, personal loans do not require collateral. Most lenders will mainly be interested in two things, your credit score and ability to repay.

Starting from July 2019, Singapore revised the total amount that one can borrow in personal loans from 18 times one’s personal salary to 12. Note that this does not mean the lender will automatically multiply your salary by 12 to determine the amount you will get. Most of them approve less depending on your ability to repay and credit score.

Why a Personal Loan is a Good Option for You

The following benefits indicate why a personal loan will be a great option for you.

  • Freedom on How to Use the Money

Most loans offered by lenders are attached to specific uses, but personal loans are different. Once approved, you are free to use the cash as you want. So, whether you wanted to plug a financial gap or make a personal purchase, it will be a great option. Indeed, you can even use some for business and the rest for pressing personal issues.

  • The Cash is Applied Fast

If your business is in urgent need of funds or the cash is meant for an emergency, a personal loan in Singapore will be a good option because the approval is done fast. In most cases, this only takes a few days to get the loan approved and funds released into your account.

  • You can Refinance the Loan when the Credit Score Improves

For borrowers with poor credit scores, a personal loan in Singapore can be a turning point to improve it. First, you need to clear the previous debts and then use new credit to demonstrate the new commitment to follow loan agreements. By the time you clear the loan, the score will be higher. Make sure to also check your credit report and fix issues errors that might be there.

While the benefits of using a personal loan to get back on track after COVID-19 are many, you need to be careful because the freedom for using the funds can easily make one direct the funds to the wrong area. Therefore, you need to direct the money to the area it will deliver the highest value.

Now that we have demonstrated the long list of benefits that come with using personal loans, you have one more thing; the application. Well, with hundreds of money lenders in Singapore, the process of reviewing all of them and preparing dozes of applications can be challenging. This is why you should work with lender comparison sites, such a Lendela.

At Lendela, the process of applying for a loan is short, easy, and convenient. You only need to visit their site to make a short application. Then your application is sent to different lenders who give offers. From there, all you need is to select one offer, sign the loan agreement, and that is all!

If you need to emerge from the shadows of COVID-19, do not hesitate to take a personal loan in Singapore. Remember to plan how to repay the loan appropriately until it is over.

About Charles Knox 1393 Articles was established to deliver accurate financial information that can help anyone that wants to take control of their finances achieve financial freedom. My Finances is your go-to place for online news. This site gives you an exceptional variety of news and information that helps you make the right financial decisions. We provide features, guides, access to companies offering professional advice & comparisons for smart money choices.