There are many instances in which difficult circumstances require an individual to seek financial assistance on short notice. Medical emergencies, unexpected expenditures, sudden damages, and so forth are causes due to which people seek funding on short notice. In such cases, specific modalities are available to these individuals to help tide them over their tough times, and one such modality is a personal loan.
Personal Loan Definition
A personal loan is a form of external debt. This debt instrument is utilized when the borrower requires funds for personal reasons. The essential difference between personal loans and other loans such as home loans, car loans, education loans, etc., can be understood from their names themselves. Like their names suggest, home loans, car loans, education loans, etc., can only be taken for specific purposes. For instance, individuals can only use the money borrowed for a home loan to purchase a home. Alternatively, personal loans can be utilized for several causes at the discretion of the borrower. The borrower need not disclose the exact reason for requiring the money.
Some common reasons due to which people take personal loans include renovating or repairing their homes, office building and other establishments, paying off sudden bills, medical emergencies and hospital bills not covered by health insurance, financing a holiday, wedding or another such event, buying capital infrastructure for a growing business, obtaining capital for a new venture, paying off tuition fees, funeral costs, etc. Almost every individual finds themselves in need of a personal loan at some point in their lives.
Personal loans are usually repaid in instalments and have a higher interest rate since the non-disclosure of borrowing makes it a riskier venture for lenders. These loans are offered by commercial banks and lending agencies, credit unions, private money lenders as well as non-banking financial companies (also known as NBFCs).
Benefits of Personal Loans
Here, we shall discuss some of the many benefits associated with taking a personal loan in Singapore.
- People often require money for various miscellaneous reasons, which may not have specific loans targeted at them. For instance, if you want to make home repairs, it is unlikely that your preferred lender will have a “home repair loan” to offer you. Personal loans serve to bridge this gap, allowing borrowers to access funds for various reasons.
- Personal loans create healthy cash flow systems for individuals and organizations alike. Such cash flow is significant for an organization’s day-to-day operations since this lubrication keeps the business running smoothly without any glitches.
- Personal loans are the perfect way to expand your growing business since it allows you to purchase machinery, stock up on raw materials or pay any expenses which may arise. These loans are a great way to support your business’s expansion trajectory, thereby allowing you to enjoy economies of scale.
- In case you wish to begin a new venture and are unable to find willing financers, a personal loan can come to your rescue, providing you with the much-needed capital to get your fledgling business off the ground.
While personal loans are a highly convenient, valuable tool under a very large set of circumstances, such a loan’s approval process can take anywhere between one to three weeks, based on the due diligence performed by the lender in question. Once the application for such a loan is submitted, lenders have to perform a thorough check on the applicant’s credit history to ensure that they will receive their payment within time, thus avoiding bad debt. However, sometimes people need to access the funds on very short notice, which are not possible using traditional lending channels. However, some remedies for this predicament exist too. In this article, we will explore the various ways to get personal loans fast.
How to get personal loans fast
In case you find yourself in urgent need of funds, some lenders offer specific packages to meet your needs. These personal loans, which individuals can obtain within a day of application, usually come with their own unique set of terms and eligibility requirements.
- These loans will ensure you have money in your bank account within 24 hours of applying.
- The approval of these loans gets done in minutes.
- The payback period of such loans tends to be flexible.
- These loans usually have an online application process, hence requiring much less on-paper documentation.
- Your eligibility for such a loan is contingent on your credit history and credit score.
- Some lenders also offer EMI repayment options, but they usually come with a higher interest payment.
- Some lenders also offer flat interest amounts for specific lump-sum brackets, but this feature varies from lender to lender.
The exact terms of these loans tend to be flexible to fit the needs of the borrower, which is another major bonus when it comes to personal loans. The lenders who offer this type of loan have a unique due diligence process that is shorter, thereby allowing borrowers to bypass the hassle of a full-scale credit history evaluation. Your age, monthly income, and overall credit score are certainly taken into consideration, along with other parameters unique to each lender.
Overall, getting personal loans fast is easy in Singapore once the borrower is armed with the right resources. The best way to proceed is to contact various banks, discuss their loan terms and thoroughly compare these terms before coming to a final decision. Further, it is essential to authenticate the source of your loan.
Commercial banks with solid reputations are usually safe bets; it is necessary to know how to check licensed money lenders if that is the recourse you choose. Many illegal lenders are known as loan sharks who may pressure you to repay them in the future; hence, make sure your borrower is authentic and read over the scheme-related documents very carefully before proceeding. When used correctly, personal loans can prove invaluable to assist all your financial ventures efficiently.