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Personal Loans in Singapore


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Pros and Cons of Personal loan



plnAny and all types of loans come at a price and have their own set of risks. It is easy for a borrower to be confused on which type of loan he/she should apply for. These consumers need a bit of help in deciding which loan to apply for so here are some Pros and Cons of availing of a personal loan in Singapore.

PROS

  • No collateral

Since an unsecured loan does not require collateral, the borrower is at a lower risk of losing assets. In the case of a secured loan, if the borrower fails to make timely payments he/she could lose his/her home.

  • Fast money

A personal loan is a loan that a borrower can receive almost immediately, making this type of loan very useful for emergency situations.

  • Quick processing

This type of loan does not require much proof from the borrower, making the process of the application much quicker than a secured loan.

  • Online application

Applying for this type of loan is even more convenient since this type of loan can be applied for online. Unlike other loans which often require the borrower to make several in-person visits to the lender, a personal loan can be accomplished from the comfort of the borrower’s home.

  • Extended period for payment

One of the biggest pros of a personal loan is that most lenders allot a considerable amount of time for the borrower to pay back making repaying the debt less burdensome for the borrower.

CONS

  • As much as possible do not apply for a personal loan

There are other ways to gather money that you are in immediate need for. It is possible for a person to borrow money from trusted friends and relatives as so not to incur any interest.

  • An unsecured loan is harder to get

Unsecured loans are much more difficult to get since they do not make use of collateral. This type of loan usually has a higher interest rate compared to a secured loan which makes use of assets as a form of collateral.

  • Prepayment penalties

In most cases, paying a debt early would be better but not when it comes to personal loans. A borrower acquires additional charges if he/she pays his/her debts ahead of the scheduled time.

  • Limited purchases

This type of loan is usually too small to make big purchases such as buying properties and cars.

  • High interest

Since this type of loan involves a smaller amount of money, the interest rate for this type of loan is often higher than that of a secured loan.