Payday loans can be a lifesaver when you need urgent cash. However, most Singaporeans are wary about getting loans, and for good reasons. So before turning to this option, you must first consider your financial situation and your capacity to pay off the loan.
Payday loans are a type of short-term loan that you can get to pay off emergency expenses. It is usually marketed as a way to bridge the gap between paychecks. It is especially helpful when you have financial emergencies that require immediate attention.
That said, consider getting payday loans as a last resort. Here are some of the benefits of payday loans you should know about.
Easy to Apply and Qualify
Unlike personal, home, and other major loans, it’s easy to obtain a payday loan. It doesn’t have strict eligibility criteria, so that you will qualify for one easily.
Here are the common eligibility requirements for payday loans:
- At least 18 years old
- Minimum salary of $1,500 for Singaporeans or Permanent Resident
- Minimum salary of $2,000 for Foreigners
Other than these, most licensed moneylenders would like to take a look at your repayment history. Payday loans must be repaid on your next paycheck. That said, you’ll need to have a good repayment history.
Approval Process Is Fast
If you need urgent cash, a payday loan might be just what you need.
While applying for personal loans from banks is a common option, the application process can be long and tedious. It can take weeks for your loan to be approved. With payday loans, the process is fast.
Most moneylenders can disburse cash within an hour once you qualify for it. So a payday loan is a great option for emergency financial situations.
It Is an Unsecured Loan
Payday loans are a type of unsecured loan, meaning you don’t have to put your home or car as collateral during the application process. That said, licensed moneylenders cannot seize your property in case you default on your loan.
You Can Borrow Even Without a High Credit Score
Can’t get a loan because of bad credit?
With payday loans, you don’t have to worry about your credit history. Licensed moneylenders will evaluate your ability to repay the loan based on other information and documents.
However, your credit score will still affect your overall interest rate. This means having a higher credit score will help you get a lower interest rate.
There are Caps on Interest Rates and Fees
Worried about getting a payday loan due to high-interest rates and fees? You should know that the Singapore government has placed limits on how much money lenders can charge borrowers. In fact, they can only charge up to 4% interest rate per month.
These rules prevent licensed moneylenders from charging too high. It also helps alleviate the financial stress on borrowers, helping them address their immediate financial needs.
Payday loans can be a quick and easy remedy when you’re strapped for cash. But remember that this type of short-term loan needs to be repaid around a month or two after you borrowed money. That said, the interest fees and short payment terms can lead to a cycle of debt. So make sure to pay off your loan obligations on time.
If you find yourself in dire need of cash, consider getting a payday loan from a licensed moneylender near the East Coast. Bugis Credit Pte Ltd. is a licensed moneylender that offers payday, personal, and foreigner loans with reasonable interest charges.
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