The Covid-19 Pandemic caused a very challenging year to many Singapore citizens. This detailed guideline will help enlighten you with a very convenient option for an economic solution for your financial burdens, and how to get it solved before the year ends.
This is where an urgent loan comes in. Due to the unawareness or preconceived notion of urgent loans, most people avoid applying for a fast cash loan. Most people view urgent loan with prejudice and that the money lenders in Singapore who provide them lack credibility. In fact, urgent loans prove to be one of the easiest ways to put your mind at ease.
Moreover, the process of borrowing money through urgent loans in Singapore usually only takes about thirty minutes. You can receive the urgent cash from a money lender within the hour. Anyone who aims to take the application shouldn’t worry about spending too much time. The process is commonly acknowledged for swift and efficient loan approvals. Not to mention, the interest rates are very practical.
What Are Urgent Loans?
Similar to what are commonly known as fast cash loans that people often resort to in times concerning unforeseen events, like losing a job or standing in need of urgent cash for emergency medical treatments.
These unfortunate circumstances force some of us to spend money beyond our budget. These kinds of situations are usually unavoidable for common folks. Fortunately, an urgent loan offers instant fast cash approvals and short term repayment schemes.
An urgent loan Singapore has an approval time of 1 hour after the loan application. The repayment period is normally between 6 to 12 months. This is the main reason for which urgent loans are known as “short-term” loans. However, be aware that you should pay your dues within the deadline or loan tenure, otherwise it will reflect heavily on your credit score.
What Are the Types of Loans That Can Qualify as an Urgent Loan?
These are the different types of fast cash loans in Singapore which qualifies as an urgent loan. Check the provided classifications below:
1. Personal Loan
Personal loans fall under the category of an installment cash loan in Singapore, which means that you are to borrow a particular amount of money and return it with the interest every month until the debt is paid for completely.
The period for paying the borrowed money from a personal loan is usually within 12 months. The moment you finish paying personal loans in full, will also be the time when your account will be closed. If ever you will need an urgent personal loan again, then you have to get a new application for the financial loan.
Loan amount: Average loan amount is usually up to 4x of applicant’s monthly income
Interest rate: Ranges from 3.48% to 5.43% p.a.
Repayment period: 1-5 years
Loan amount: Up to 6x of applicant’s monthly salary
Interest rate: Ranges from 1-4% per month
Repayment period: Up to 12 months
2. Payday Loan
The payday loan is a type of loan that is used for a very short period that is usually not longer than a few weeks.
The payday loan is commonly utilized by people who are in need of cash instantly. The reason is that the process of applying for a payday loan can be done in just a matter of minutes.
Moreover, the licensed money lender who let you borrow the money will check on your earnings. This is done for the purpose of determining whether you are capable of repaying the borrowed amount. A payday loan in Singapore is usually approved after the previously mentioned credit profile and borrower’ income evaluation.
The difference of a payday loan from a personal loan is that you won’t have to repay the borrowed money in monthly instalments, instead, you will have to make a repayment of the full amount in your next payday to the money lender.
Loan amount: Up to 1 month’s worth of the applicant’s income
Interest rate: Ranges from 1-4%
Repayment period: within a month or on next payday
3. Pawnshop Loan
This type of fast cash loan Singapore requires you to give any of your valuable items as a collateral to get access to the money. The pawnshop will determine the value of your item and will borrow you the amount of money according to this value. In this type of loan, you basically pledge your item while you repay the loan. If for some reason you can’t repay the loan within the deadline, the pawnshop can sell your item to interested buyers. This type of loan in Singapore is very convenient for those who don’t want to get through a very complicated approval process.
How much you can borrow: Depending on the value of the item you want to pawn
Interest rate: Usually starts at 1% for the first month, 1.5% for the second month, 3% for the third, and so on. 12th month is around 18%
Repayment period: 6 months, if you exceed, your pawned item will likely be auctioned off to interested buyers.
4. Credit Card Advance Loan
This type of loan is one of the most preferred and popular loans in Singapore. It involves borrowing a certain amount of cash by means of credit through a credit card. There are ways to get the money once you are approved of the loan from a particular company in Singapore. One of the ways of obtaining the loan is by using an ATM. Some companies in Singapore directly give the money by means of a check which is deposited from a particular bank.
However, it usually involves higher rates and fees. You have to pay twenty-four percent at an average, which is almost a nine percent increase compared to the average APR for purchases. Aside from what is mentioned, the interest is accrued at a short span of time which has almost no grace period given to the borrower.
Apart from the interest, if you are to utilize an ATM for cashing out then you are going to be charged again with another smaller fee.
Although this loan option costs more, the loaned amount will be handed to you immediately.
Loan amount: Up to SGD 3,000 per day, depending on your approved loanable credit
Interest rate: Around 24% to 29.9% APR
Repayment period: over a year or longer
Cash advance fee: 5%-6%
What Are the Benefits and Drawbacks of Acquiring an Urgent Loan?
The main pros of the urgent loans are these:
Non-collateral (in nature): This is an important advantage as you don’t have to give any of your valuable possessions as a guarantee to acquire the loan, reducing the risks. Furthermore, you don’t need to declare a guarantor to be approved for this type of loan in Singapore.
Simple Application: With less paperwork, an urgent loan will save you a lot of time in contrast with other types of loans. An urgent loan is easy to apply to, and they provide fast approvals. Additionally, the online process of this loan makes everything simple but efficient.
Flexible and easy repayment options: An urgent loan in Singapore proves to be very flexible since the interest rates are very convenient and competitive. There are a wide range of loan repayment options in Singapore you can choose from to support your needs.
The main cons of the urgent loans are these:
Higher interest rates: For the reason that there’s no required collateral for an urgent loan in Singapore, the interest rates are higher than a traditional loan backed by an asset as a guarantee.
Stricter requirements: The borrower profile, income level, the credit score and credit history, the debt level and many other criteria are usually evaluated more deliberately for this type of loan.
Urgent Loans are expensive: An urgent loan is more expensive than a traditional loan backed by an asset or collaterals.
What You Need to Know When Choosing the Loan?
Getting access to a loan is not an insignificant thing. As a borrower, you want to trust in your lender. You want reliability, assurance, certainty, etc. All these factors can be summarized with a simple word: credibility. It is not easy to determine if a moneylender has enough credibility to qualify as a lender. You need to do your due diligence and research before you embark on this venture.
What to Know?
- Borrowers are able to use the urgent loans in the form of unsecured personal loans, payday loans, title loans, or credit card advances.
- The funds utilized from the urgent loans are allowed to be sent directly to your bank account. This may usually take within the same day of application or two business days. The waiting time is highly dependent on the lender and the details from the loan application submitted by the borrower.
- The application process and the options provided from the urgent loan should be fully understood by the borrower. So, it is recommended to research first, analyze the provided statements or agreements, and read the details all throughout the process.
What to Look Out For?
- The terms for repaying a borrowed amount should be reasonable. The terms will always be different from one lender to another and this is also the reason, a borrower must always do an analysis of the terms being provided.
- An application for the urgent loan can usually be found online, but the lender still needs the borrower to exert an effort by means of providing the required personal and financial documents. These are submitted for the application process to proceed.
Loans online commonly process the approval faster compared to a one-on-one negotiation. So, the faster you comply for the requirements, the quicker the loan will be approved.
Some people might feel intimidated and embarrassed to apply for a loan, but as life is not perfect, financial emergencies are bound to arise without us expecting it. The most practical solution to solve urgent financial challenges is to get an urgent loan, with the opportunity to repay the money during a fixed period of time.
Keep in mind the idea that urgent loans are not exclusive for the rich, the poor, or the middle class. Urgent loans are designed to cater anyone from any walk of life, as long as you are responsible in balancing your financial situation and obligations.
A1 Credit is a trusted personal loan provider in the industry. We are a legal and reputable licensed moneylender that gives you fast and convenient financing solutions and best personal loan Singapore that follow the standards of Moneylenders Act and Moneylender Rules.