You might be wondering if you’ll ever get a personal loan if your income is low. After all, lenders usually insist on proof of stable income before they give you money.
But don’t worry, it is possible to get personal loan for low income in Singapore. It just takes some careful planning and persistence to find the right lender and meet their requirements.
There are plenty of options available for those who have a low income but still need money quickly and temporarily. There are a few different types of loans that can help you access cash when you need it most financially.
Depending on your circumstances and needs, one option might be better than another for your situation.
Things to Keep in Mind When Borrowing for a Personal Loan for Low-Income
Personal loans are an excellent way to help you get the things you need in life, especially if you have a low income.
There are a few things that you should keep in mind when applying for a personal loan.
First of all, you should make sure that your annual income is low enough to qualify. The best way to do this is to look at the Annual Household Income chart in your credit report. This will show you the range of incomes that apply to your situation.
Another thing that you should keep in mind is the total amount of money that you want to borrow. Keep in mind that this amount may end up being more than the amount of money that you actually need.
You should also look at how long it will take to repay this loan. This can give you an idea of how much interest you will be paying overtime.
Finally, make sure that there are no fees or additional costs associated with the loan.
Types of Personal Loan for Low Income Earners
Here’s an overview of the different kinds of loans available to low-income applicants:
Short-Term Loans
This type of loan is designed to be repaid quickly and is often granted with no paperwork or credit checks. Interest rates tend to be higher with a short-term loan, so make sure you understand the terms before you sign.
Some common examples of short-term loans include payday loans, car title loans, or cash advances from a credit card.
There are some drawbacks to short-term loans, such as high interest rates and a high chance of falling into a debt cycle. Be aware of the risks involved in taking out a short-term loan and be sure to repay it quickly — sometimes in as little as a few weeks!
Installment Loans
Installment loans are granted in one lump sum that is then repaid in regular installments. You make repayments to the lender either by setting up a direct debit to take the amount out of your bank account or by making a payment directly to the lender by check.
There are a number of different types of installment loans, including personal loans, student loans, and auto loans.
Personal installment loans are available for those with a low income and a bad credit rating. Interest rates may be quite high, especially if you have a poor credit score, but installment loans are relatively easy to qualify for.
They are a good option for those who need a larger amount of money and have a steady income.
Debt Consolidation Loans
If you have multiple unsecured debts, you might be able to take out a debt consolidation loan to pay off your other bills.
Debt consolidation can help you get back on track financially by reducing your monthly repayments.
You can repay the loan over a set period, such as a year, at a fixed interest rate. If you have a low income, you might be able to take out a government-backed debt consolidation loan. These loans are offered to people who have a low income or are unemployed. They are repayable over a longer period of time at a fixed interest rate.
Find the best debt consolidation loan in Singapore.
Final Words
When you have a low income, it can be easy to fall into the trap of taking out multiple high-interest loans to pay for basic necessities.
If you run into financial difficulty, the best thing you can do is seek out advice and help from a professional.
It’s important to be responsible when you have a low income. When you have no money coming in, it can be tempting to take out cash where you can get it.
But you need to be careful not to fall into a cycle of debt. Be responsible with your finances and find a way of getting by that won’t stress you out too much. With a little creativity, you can make do with less and still get by.
Also learn more about: HDB Optional Component Scheme