If you are thinking about taking a loan, you need to be aware about the different types of loans, their features and limitations. Otherwise, you might not be able to pick up the best option depending on your financial requirements.
There is huge demand for different types of loans in Singapore, especially payday loans and personal loans. But how many investors know the difference between these two? This post revolves around the distinct features of payday loan and personal loan and so that you can differentiate between the two.
In simple words a payday loan is the loan of an amount that is to be paid as one time installment when you receive your next pay check. You are not required to keep security for such loan and the formalities are also minimal. In order to get a payday loan in Singapore, you need to be at least 18 years of age and should have a stable job.
In order to get a personal loan in Singapore, you are required to deposit all the necessary documents including security papers to the licensed moneylender. If your loan is approved you will be informed about the interest, loan tenure and the monthly installment that you need to deposit. Thereafter, you are required to pay the fixed installment every month till the loan period is over.
Now the next important question is how to choose between a personal loan or payday loan. The answer to this question depends on a number of factors including your financial requirements and repaying capabilities. For instance, suppose that you require the money for the operation of a relative. Now, since it is an emergency case, you can wait for longer duration and thus payday loan should be your choice. You can get such a loan processed in a week or so from any lenders. There are numerous banks and financial institutions in Singapore that will help you in this regard.
On the other hand, suppose you want to take a loan for buying a car. Now, it is not possible to repay the whole loan amount with a single pay check. As such, a payday loan will not be helpful in this case. The better alternative is to go for a personal loan in this case as you can repay the loan amount in installments. There are various other factors to consider as well at the time of choosing between different types of loans. You also need to research about the different loan providers so that you can get the best deal.