A Singaporean payday loan is aimed to be a short-term borrowing service available to salaried individuals. The loan repayment period is often arranged over days before your next take home earnings but can also be spread over several months. Payday loans are good sources of quick cash in case you are faced with financial emergencies. The payday loan has fixed interest rate which is often higher than other most of the other borrowing loan alternatives. This loan type is a convenient way for an individual to have some extra cash for their day to day use before their next paycheck. When a borrower defaults in repayment of the payday loan, the loan amount taken can quickly grow into large and hard to repay the loan.
The payday loan application process is fairly simple and once it is approved, usually after you have submitted all the required loan application documentation, the money is disbursed to your account within 24 hours. Payday loans when not properly handled can hurt your credit score. When lenders see payday loans, it already shows them that your finances are already strained. Although standard credit reports do not show short term loans, it is advisable to ensure you repay your payday loan as soon as possible. This will also prove to lenders that you are a responsible borrower. Defaulting on payments can jeopardize future attempts at taking mortgages or loans. Payday loans are often time unsecured loans.
How Does Payday Loan work?
Singaporean payday loans are aimed at offering quick cash to individuals who have financial commitments to attend to. The amount, once approved is transferred to your account and at the end of the month, it should be repaid plus the interest it has attracted. However, longer repayment periods can be negotiated with your legalized moneylender. How payday loan works are by ensuring the borrower is offered a quick financial solution to the funding crisis they may be experiencing. The lender requires you to provide them with your personal information and documentation which serve as proof of the information you have offered.
Once you have the required documents, you are expected to fill a loan application form which is often to find on the licensed moneylender platform. The loan officer from the moneylending institution then contacts you, usually within a few minutes after you have submitted your application. The loan application and approval process are very easy and fast therefore ensuring you receive the loan amount within hours after you have applied. The terms and conditions of the loan are always contained in the loan contract. This contract indicates the interest rates charged on the amount you have taken, the repayment period and the expected contributions.
It is advisable for a borrower to ask for clarification when the loan officer is working out the loan with them to ensure there are no hidden charges. As a borrower, you need to consider the implication of any defaulting and penalties you will incur.
Payday loans are best paid quickly as they attract high-interest rates, therefore, the longer you take reimbursing the loan the more you end up paying. It is also important to remember that any loan contract you sign, you are legally bound to honour the terms and conditions stipulated in the contract of the loan.
What You Need To Know
It is useful and important that you fulfill a few requirements before applying for a payday loan in Singapore. These requirements are necessary to enable the moneylender to process your loan application with ease. This also ensures fast approval of your payday loan application. The requirements are:
- You need to be older than 21 years.
- You need to be a Singapore national, an expatriate in Singapore with a valid working permit or a permanent resident.
- You should need to have a steady source of income to facilitate your advance repayment achievable.
- You need to submit a valid identity card.
- You ought to have evidence of current billing address. Utility bill for proof of address is accepted
- You have to attach your past three successive month’s payslip.
- If newly employed, attach your employment letter to your form of application.
- You are required to present your income tax statement
- This loan is not applicable to any undischarged bankruptcy or having pending bankruptcy
- Your annual earnings need to be more than $18,000.
Who Provides Payday Loan?
Licensed moneylenders in Singapore often provide the payday loan. These moneylenders are licensed by the Registrar of Moneylenders. Moneylending institutions follow set rules and regulations that govern how they carry out the financing services they extend to their clients. The moneylending institutions are required to have valid licenses and an updated list can be accessed from the Registrar of Moneylender’s website. These institutions have a set limit on the amount of money an individual can take as well as the interest rates to charge.
Before taking any loan from a moneylender, ensure to check they are approved and registered moneylenders. Moneylenders are expected to offer all the necessary information to borrowers before they sign any loan contracts. This way the borrowers are able to understand what they are signing and the interest rates they have been offered. In order to avoid any hidden costs, borrowers are to be given the details and the working of the loan to ensure clarity to the borrower.
Payday loans offer quick access to money for individuals who need money fast. Singaporean payday loans are approved within a short period upon submission of the required documentation and a filled application form. How payday loan works are in providing quick cash to individuals. The loan amount is often repaid when they receive their next paycheck. The availability of funds makes it easy for individuals to attend to financial emergencies like car breakdown and medical emergencies with ease and in a stress-free manner. The fast approval rate of payday loans ensures quick cash is availed to your account in hours.