Qualifying for a loan deal in Singapore could be difficult if you are not aware of the requirements you need to meet. These requirements are there in order to assure the moneylender and increase your chances of securing the loan deal. Also, in some circumstances where there are a lot of loan proposals to deal with, some of these requirements would give you an edge over others. This is because every legal moneylender in Singapore is looking out for security on the loans they give, and these requirements ascertain this, proving that you are a much more reliable borrower than others. While they could vary for various lenders and various loan types, but most times, these are the basic requirements that lenders look out for before qualifying you for a loan deal.
Some people have outstanding credit, and some people have challenges with this due to situations like late payments. Bad financial situations can happen to anyone, and sometimes that’s the reason for a low credit score. However, having a positive credit rating is often a requirement that many licensed moneylenders need. In certain situations, however, credit rating can be an exception, such as applying for a consolidation loan.
The next thing a reliable moneylender needs to know before qualifying you for the loan deal is your income. This goes hand in hand with your job stability and income. Lenders want to see some kind of stability and a good income to convince them about your loan application. This is how they will know that you can afford the repayment.
They need to know that you have the income that can be used to pay back the loan amount that has been negotiated in the contract on time and in the exact amount stated.
Any outstanding debts you have are also part of the loan application process. This means that all your finances, such as your car payment, child support, home payments, and more are all reviewed before approval is given. If you make $5,000 a month, but you have $2,000 a month in debt, it doesn’t leave a whole lot for some loan payment. So financial lenders in Singapore take a look at all the numbers versus your income.
A Down Payment
For special kinds of loans like business or housing loans, Singaporean moneylenders may have down payments as a requirement. If you put up your own money that you worked hard for as a down payment, they will know that you are serious and committed to the loan deal. On the other hand, if you can’t afford to pay the down payment amount, it makes it a little bit tougher for the legal moneylender to accept the deal. This doesn’t mean that it is impossible, but a down payment does increase your chances.
Another factor that many licensed moneylenders need for a loan process is the availability of collateral assets. This is especially relevant for large loan amounts such as business loans. Collateral serves as security for a loan and can be seized as payment for the loan amount if the borrower defaulted on payments. In addition, loans that are secured by collateral commonly have lower interest rates. In this way, moneylending services can recoup most or all of their losses.
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