The Outline of How to Qualify For a Ppersonal Loan

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  Personal loans singapore are easy to acquire especially if you don’t apply for too much money. Some lenders...

  • Category: Financial & Legal Services
  • Published: 15/10/2015
  • Current Rating: /5 0 Vote


      Personal loans singapore are easy to acquire especially if you don’t apply for too much money. Some lenders will however limit you to certain amount if the loan is unsecured because there is no guarantee apart from your promise to pay.Basically there are two kinds of personal loans-secured and unsecured. Secured loans offer lower interest rates compared to unsecured loans. However, you have to put up something as collateral such as your house, car, boat or anything valuable. If you fail to pay the loan, you will lose that collateral. Unsecured personal loan also known as signature loan on the other hand, requires no collateral but usually comes with high interest rates. The bank will loan you the amount you require using your signature. Here is an outline of how to qualify for a personal loan. 1 Identification The lending institution will require your personal information which might include your national identity card, driver’s license or social security number. The bank will use this information to run a credit check with other banks to access your payment history and whether you owe debts to other lenders. Most lenders usually require a higher credit score to consider you for a loan. Those that don’t require higher credit scores will charge you higher interest rates. 2 Bank Statements Whether you have an existing debt or not, lenders will require bank statements for the previous months as proof of your income and whether you are making payments to other creditors. They will also check for any overdraft activity in your account and access if you usually apply for overdrafts before your payday. 3 Employment Information To determine your debt-to-income ration, lenders will require proof that you are employed. They will also ask for recent pay slips. In case you have an existing debt, they will combine it with new loan payments and compare it against your income. This way the back can verify your ability to repay the personal loan. 4 Tax Information You must also show your tax returns for either a year or two. The lender will use this information to know if you usually pay taxes and hence your ability to repay the loan. 5 Final Word of Advice A borrower who is looking on how to qualify for a personal loan should always check with the local lending banks, access their equipments and interest rates as well. Whether you are a high risk borrower or not, also check a bank’s repayment periods and whether they suit you. If you don’t meet the minimum requirement set by the bank, you can opt for independent lending institutions. Such lenders will however charge you higher interest rates.

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