An average household in Singapore deals in around $57,630 in debt. Getting a loan approved is not as easy as it seems. You need to clear so many hurdles and meet so many conditions before your application gets accepted for processing. And if you don’t know the ways to get loan approved, it could end up being a colossal disaster – the kind that might cost you months or years of waiting on your part before you can get your hands on the money.
Before applying, know these mistakes to avoid when you need to take a loan in Singapore fast.
- You Don’t Ask for Recommendation or Advice
- You Forget to Check Your Credit Report
- You Apply for More than One Loan at Once
- You Don’t Know Your Monthly Income or Expenses
- You Forget About Hidden Expenses that Come Up All the Time
- You Don’t Read Terms and Conditions
- You Don’t Think about Repayment Period and Interest Rate
- Final Thoughts
You Don’t Ask for Recommendation or Advice
Each person is indeed unique with their specific credit score and financial situation. Thus, it would be wrong to assume that the same loan product and interest rate will be suitable for each person.
But it still doesn’t mean that you should apply without doing any homework first – asking for references or advice is not a crime. Many financial experts out there can answer all your questions, tell you what they know about different lenders and their products, and tell you what they think about your chances of getting a loan.
You Forget to Check Your Credit Report
It’s an obvious fact, yet so many people fail to check their credit report – both personal and business – at least once a year. This is because it demands time and effort that most people can’t spare.
But it’s such a crucial step, especially if you need to take a loan fast in Singapore. This is because a good score will help you get the best interest rate, the lowest cost of borrowing, and improved chances of being approved.
You Apply for More than One Loan at Once
It’s no secret that lenders have different criteria for approving applications. Some may only approve those with a verifiable income source, while others may require a more significant down payment.
So applying for more than one loan at once can create a bigger problem for you several months down the road, especially if the lenders approve your applications but decline to honor them.
You Don’t Know Your Monthly Income or Expenses
It’s not that hard to calculate how much money you will need per month when you have a regular income.
But to have an accurate estimate, you must know how much money comes in and goes out from your household every month – the bills that need to be paid, groceries that need to be bought, transportation expenses, etc.
If you don’t, your lender will do it for you, and the amount they come up with might be completely different from what you think is right.
You Forget About Hidden Expenses that Come Up All the Time
If you want to get everything right before applying for a loan, you must also remember all those hidden expenses that come up once in a while.
It can be higher utility bills or medical expenses. For example, if you forget about them until your lender asks for your income information, chances are they will discover the problem at this stage of applying.
You Don’t Read Terms and Conditions
Just because the lender approves your application doesn’t mean that you are automatically obliged to borrow money from them.
You should carefully read all loan terms and conditions before signing the documents to ensure that everything is right for you. It’s even a good thing to consult an expert or someone who has more experience in such situations with you before getting your loan, no matter how desperate you are for cash.
You Don’t Think about Repayment Period and Interest Rate
It’s easy to get excited with a low-interest rate and a long repayment period when you need money fast in Singapore.
But don’t forget that the lower interest rate will cost you more in the long run if your loan repayment period is too long. And even loans with low-interest rates can become incredibly expensive if they come with an extended repayment deadline or no grace period at all.
The main mistakes you should avoid when applying for a loan in Singapore. There are probably more of them, but these are the most common ones that people keep making time and again.
With these guidelines, you may now understand the ways to get a loan approved. If you still think that your situation is special enough to ignore any of this advice, then at least try not to forget about all of these tips at once.