How Can You Know That You’ve Found the Best Payday Loan in the Country?

 

In an ideal world, all of us would benefit from the necessary financial freedom to pursue our personal aspirations and improve the livelihood of loved ones. But, unfortunately, we do not live in a utopia in which our economic woes are inexistent, and occasionally, for a large percentage of us, daily responsibilities can sometimes slip into unfortunate situations in which our funds are almost depleted. It’s a reality of our times, but even though Singapore is one of the wealthiest city states in the world, the percentage of individuals facing economic hardships and potential financial instability is rising year after year.

Are you one dental work away from becoming unable to pay your monthly financial obligations? Have you dealt with a personal situation that emptied your monetary reserves and made you vulnerable to market fluctuations? Are you unable, right now, to pay your rent or shop for daily necessities? You are not alone, and there is absolutely nothing wrong in asking for help from time to time. When provided by a reputable and licensed moneylender, a payday loan can represent a short-term solution to complex financial situation, that hopefully, could give you the break required to fix your long-term finances and reduce the stress of monetary struggles.

Yes, sometimes it’s hard to know if you obtained the best payday loan in our nation. And that’s because the provisions of these financial packages differ slightly from lender to lender. But, regardless of the source of this financial aid package, payday credits all have something in common. They are usually approved in less than two days, they don’t necessarily require a high credit score, and you will only be asked to submit a valid ID, proof of your income and a bank account as documentation annexed to your application (typically).

It’s a Good Financial Solution, But It Shouldn’t Be a Long-Term One

Even the best payday loan in Singapore will be characterized by interest rates far higher than those found in a typical personal loan. If we analyze them closely, payday credits are in a way, a form of personal loans that are typically expected to be paid back by the end of the working month. The documentation necessary for them is basic, and the sums loaned out are very often capped at one or two months of the borrower’s income.

With a payday loan in Singapore there are no collaterals involved, and no catches. You need quick cash with no questions asked, and you get it. How much you will have to pay back? That depends on how much you borrowed. In a worst-case scenario, the lender you contact would impose a 4% interest rate on the financial aid package you selected, on top of a 10% administration fee on the loan principle.

If you borrow, let’s say, $1000, and you want to pay it all back at the end of the month, that means that on top of those $1000, you will also have to pay an extra $140. Is it considerable? Sure, yes. But in emergency situations in which you truly need the money it’s a trade that many are willing to consider. Plus, that’s the worst-case scenario. As per the regulations imposed by the Moneylenders act, a 10% administration fee, and 4% interest rates are the maximum values a lender can charge in this country.

So, What About the Documentation?

Do you think you have found the undisputed best payday loan in the country, and are in quick need of a cash injection? If so, you will have to prepare the necessary documentation for your application. The lender you apply to will require proof of your ongoing income, potentially some recent bank statements, and a proof of your identity. For the latter, if you are an SG citizen, your NRIC should suffice. If you, however, are a foreigner, you will be required to present your employment pass or a work permit issued by the authorities of our country.

Contrary to popular belief, foreigners are indeed permitted to contract financial services, like unsecured loans while working in SG. However, in their case, the minimum income thresholds applicable by lenders are a bit different. For the proof of your income, the private lender you contact will require a copy of your digital pay slips. Plus, most of them will need you to have been active in your current job position for at least three months before submitting your application.

If you’re confident you found the best payday loan in the country, maybe this will not apply to you. However, it’s something worth considering. You just started your job at a newly founded company? If so, it would be best if your also prepared a copy of your employment contract. Are you self-employed? That’s a bit more complicated, as most likely the lender will need your latest CPF Contribution Statement, or a Notice of Assessment from the Inland Revenue Authority of Singapore. That said, ultimately, being self-employed shouldn’t have a huge effect on the potential success of your loan application.

Are There Other Options?

Sure, but it depends on your ongoing financial obligations and current monetary situation. Even the best payday loans available in SG are just short-term solutions, suitable for situations in which you need a helping hand till the end of the month. Do you require a more extensive cash influx, that you are looking to pay back over a longer period? In that case, you should consider a traditional personal loan. Do you benefit from a good credit score, and your overall annual income is above $20,000? If so, you could probably obtain a decent interest rate and repayment period without necessary having to guarantee your application with collaterals.

Nonetheless, if your current economic situation is shaky, collaterals can unfortunately be a requirement, as your risk score for the lender will most likely be unacceptable. There are solutions yes, and a bad credit is not the end of the world. Still, collateral-based loans are the best possible option if you are facing economic uncertainty and you want to benefit from a repayment plan that’s advantageous for your family’s current economic situation.