1. You need to be between 21 and 65 years of age, have a steady job, and a clean credit report.
2. You need to be solvent; meaning your DSR (debt servicing ratio) must allow additional debt. This is the ratio between your income and the amount of money you spend monthly on your bills and servicing other debts. It should be below 50%.
3. Most banks have some requirements regarding the amount of your income, especially for foreigners with working permits. Usually, Singaporean citizens and permanent residents having an annual income of $ 30.000 or more are eligible for loans which can take up to four times that amount. Those having an annual income below $ 20.000 are limited to a maximum sum of $3. 000. Special conditions regarding the amount of loan, fees and dynamics of repayment apply for those having an annual income of more than $100.000.
4. In order for your application to be processed faster, you should submit it online, although these days personal loans usually do not take more than a day to be processed.
5. Documentation required to apply for personal loan includes: proof of identity, salary slips, proof of residence, and sometimes even record of your taxes. Make sure you have them ready, in order to speed up the process.
6. Since most personal loans are unsecured, you do not have to put any collateral as a security mechanism for this type of loans, but it usually means higher interest rates than with secured loans.
7. Consider the duration of a loan. It will largely depend on your monthly income, and how big rate you can afford yourself, but try to clear it as soon as possible, since you never know when you are going to need another loan, especially if you are planning any major loans in the near future.
8. Inquire about late payment fees. They are not the same in all banks. If you fail to repay your loan in time, late payment fees may rise very high, and increase your debt significantly.
9. Compare interest rates and fees. Make sure you check both, since some banks may offer lower interest rates, but will charge you higher processing fees, or late payment fees.
10. Choose your lender wisely. Many recommend you take a loan from those banks that are not so popular at that moment, since they will be in need of clients, and will be prepared to offer lower interest rates, some promotions, or loans without processing fees.
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