In Singapore, if you’re considering taking out a loan, you have two options available: you can either head to a bank or a moneylender. You have the liberty to choose whichever option is most suited to your requirements and expectations.
Before you make your choice, however, you must know the difference between borrowing money from a moneylender in Singapore and taking a loan from a bank. In particular, you’re looking for the best personal loan Singapore, it is imperative that you consider both options before deciding.
Credit Evaluation
Everybody knows that banks have very strict and specific eligibility standards when it comes to handing out loans. While you might think they will relax one criteria or two depending on your circumstances, that is hardly ever the case.
However, when it comes to private moneylenders, they have a more holistic approach to approving loans and ensuring that you get the financial aid you need. They do have eligibility criteria too, but they are more than willing to compromise one or two requirements to accommodate more borrowers.
Interest Rates
When it comes to interest rates, no bank and no moneylender ever has the same rates. Depending on the kind and quantum of loan you are applying for, different rates and payment plans can be offered to you.
If you want the best personal loan in Singapore, you must make a thorough assessment of the options you have available. You can scope out various lenders and banks before making your decision.
While some banks may give lower interest rates, their terms are ironclad, and you can’t break them without facing a heavy penalty. When you want a more flexible approach, especially when it comes to interest rates, it’s ideal to head to a licensed moneylender.
Loan Amount
You may be eligible for many loans depending on your income, employment status, financial history, and credit score. The loan amount is not solely dependent on your requirements but also considers how much you can pay back.
When you’re looking for a higher loan amount, banks may be unwilling to lend to you unless you put up assets as collateral. When it comes to moneylenders, they may require the same or offer a higher amount with higher interest that has additional safeguards.
Approval Rates
Holistically considering, many people don’t head to banks unless they are assured that they will be accepted for a loan. However, when it comes to moneylenders, almost anyone who has no other alternative heads over to see whether something can be worked out for their requirements.
However, it might be surprising to know that approval rates for both banks and moneylenders are roughly the same. Once you pass the basic eligibility criterion, getting your loan approved from both establishments can be easy.
Catering To Your Requirements
When you’re looking for a personalised plan that suits your requirements and adapts to a payment schedule that is most optimal for you, it might be better to head to a moneylender. The best personal loan in Singapore is a loan that meets your specific needs and doesn’t come with a high interest rate.
You will find that most banks in Singapore are rigid when it comes to catering their loan plans for your requirements. However, you can always negotiate the interest rates, down payment, and even the collateral with moneylenders to a certain extent.
Flexibility and Turnaround Times
When you’re looking for a flexible solution for your loan, there’s no better option than using a moneylender’s service. Not only will they guarantee a quick turnaround time provided you have the necessary documentation, but they will ensure you’re comfortable with the entire loan program.
Finding the perfect loan is significantly easier when you’re aware of the various options available to you as a borrower in Singapore.
Read more: What You Need To Know About Opening a Bank Account
