Personal loans are unsecured loans that can be of great help when you are in need of money due to an emergency. Many banks and financial institutions in Singapore offer personal loans. Banks like DBS Bank, HSBC Bank, POSB Bank, Bank of China and Standard Chartered Bank are some of the banks that offer personal loans. As you do not have to provide any collateral to acquire a personal loan, banks offer you this loan based on your credit score. If you have a good credit score, you will be able to get this loan easily at a lesser rate of interest.
A few reasons for which people take a personal loan include –
- Fixed tenure – Most personal loans have a fixed repayment period and one has to repay the amount within that time frame. The repayment period will depend on the bank and the tenure the borrower opts for. Tenors range between 1 and 7 years (tenors vary depending on the bank). A person can choose to repay the money before the tenor ends but he or she might have to pay a prepayment fee in that case.
- No collateral required –When you take a personal loan, you do not have to provide any collateral security, which is usually common with other loans.If you provide collateral security, your lender can take ownership of it in case you failed to pay back the money you borrowed on time.
- For travelling – You can choose to opt for a personal loan when you wish to go on an expensive overseas trip with your family.
- For renewing the Certificate of Entitlement (COE) – In Singapore, every car owner needs to have a COE, for which the price of obtaining is very high. Sometimes the cost of this certificate is higher than the car itself and one cannot take a car loan for renewing their COE. Taking a personal loan instead has proved to be a good solution for a lot of people in this case.
- For purchasing something expensive – Sometimes you might want to buy certain expensive items like a wedding ring or jewellery, which costs a lot of money and for which you can’t pay using your credit card. A personal loan can be of a great help in such a situation as you can get the money easily without having to return it immediately.
These are a few reasons for which people opt for personal loans. Getting a personal loan is not difficult, but one should conduct detailed research before applying for it. Comparing the offers of different banks is a smart thing to do, as it will help you in choosing one with maximum benefits. Once you get the loan, remember to pay it back on time, along with interest.
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