It is always advised by banks, lenders, and literally anyone that people as borrowers should only avail of deals that they can repay. However, somehow, it’s inevitable to miss out on your credit card bills due to many contributing factors.
This may be because of sudden expenses that had hindered you in repaying on time, or emergencies that prompted you to forget about your dues. Gambling can possibly be a root cause of this.
Whatever the reason for you failing to pay off your debt, there are countless ways you can consider to work your way out of this dilemma. Raffles Credit has listed down government tips when handling debts and how to clear them fast.
How to Clear Debt Fast in Singapore
1. Pay Off the High-Interest Loan Debts and Credit Facilities First.
This is because it’s the one that is charging borrowers with the most interest. To make that possible and with ease, you can make the minimum monthly payments on all your credit cards and loans and put your extra with the higher interest rate.
Avoid credit card fees and charges by paying your bills in full before the due date as well. Also, we encourage you to use GIRO to automatically pay your bills. Giro transfer is a method of transferring cash by instructing a bank to do so without having the need of using physical checks. This way you are assured you do not miss out on you scheduled dues.
2. Save up for Big-Ticket Items Instead of Buying on Instalment.
Once this is practised, you do not have to worry about paying from monthly or whenever needed. Note that plans on installation normally vary. Although they seem to be more affordable as it is broken down, depending on its type, its total cost could be much higher.
You can try using cash or a debit card when shopping around Singapore as well. This is beneficial to avoid splurging with all that’s left on your credit card. Keep in mind that comparing prices before buying is necessary.
Never shop on impulse and only buy what you can afford to get and repay. Moreover, being surrounded by those who can help you from not overspending is a great idea even. You can try avoiding people who pressure you from doing it so you can easily break bad money habits.
3. Work With Your Loan Provider.
It wouldn’t hurt to ask and inquire for your concerns, especially if it’s something as serious like this. Remember they are more knowledgeable of your deals and as likely, they can give you more information and set options to assist you on your worries.
To further resolve this issue, you can easily reach Credit Counselling Singapore for help. Its team of dedicated and experienced staff are ready to assist with personalised advice and practical approaches for borrowers like you. They can aid you in making a well-thought decision on the most appropriate course of action to address your debt problems, depending on your circumstances.
CCS Update: Given the restrictions amid the pandemic, the CCS has updated its process of appointments. Borrowers struggling with debt can first attend their Debt Management Webinar or take the Online Debt Management Course.
There, they will discuss a wide range of points to consider in addressing a debt problem, how to deal with creditors, and the common actions that creditors can take to recover the money owed. Then, you can submit a request for counseling which is arranged by meetings.
By the time you are able to send the requirements needed, you will be given a schedule for a session. A financial counselor will assist you in understanding your cash flow and determining the best solution to your dilemma.
4. Apply for a Debt Consolidation Plan.
Before anything else, debt consolidation, which is also deemed as balance transfer, doesn’t erase your original balance but it is how you can utilize different forms of financing to pay off other liabilities. Like some other loans, it has two kinds, secured and unsecured.
Secured loans are supported by one of your assets or properties, like a car or house. While unsecured loans which can be a line of credit, are the exact opposite and are likely to be a lot more complicated to obtain.
This initiative can be useful for people who have stockpiled debts. Through a consolidation plan, borrowers can benefit from a single monthly payment rather than handling multiple payments.
It can even boost your credit score along the way. However, while it usually has lower interest rate/s and repayment amount, its loan tenure is still an important aspect. If you consider availing debt consolidations, longer payment schedules would still mean paying more either way.
There may be possible increased costs too. Depending on a bank or lender, some debt consolidation services often charge hefty initial and fixed monthly fees which could be inevitable.
Where to Apply for a Loan
If you’re a Singaporean or a permanent resident earning $20,000 and $120,000 per annum, with net personal assets of less than $2m and has unsecured debts over 12 times your monthly income, you can apply for a DCP.
Same as other financial deals, one can avail a Debt Consolidation Loan from banks and licensed moneylenders such as Raffles Credit.
Raffles Credit is amongst the leading legal moneylender in Singapore, and as a licensed moneylender, we strictly operate under the rules and regulations of the Ministry of Law.
This guarantees borrowers that they are provided with great quality service that is also swift and easy. Applications in Raffles Credit are assured to be convenient with the help of our passionate financial experts and members. So feel free to borrow from us anytime!
The Bottom Line
There could be a range of ways in managing your way out of debt fast and being debt-free, however, the consequences of being unable to pay can be a little heavier to handle. Thus, it’s better to be keen on your purchases. Keep track of your payments to prevent yourself from receiving late fees and other probable penalties.
Do not borrow from other sources to pay off your debts without comparing the interest charges first. Be mindful of your monthly income over many interest charges, as well as the processing fee. More preferably, ensure that your expenses are just right. Buy the things that you’re certain to be capable of repaying. These things, although simple, matter the most.
Above all, it’s always ideal to avoid your way of falling into debt than getting out of multiple charges that are already there.
