A personal loan is a very special type of loan. There are many good things in a personal loan which may attract many people to go for it. Just looking at a few of the good things about something we should not go for that blindly. Though the personal loan is very useful in many cases, there are some darker sides of it too which you should know too before you apply for any personal loan.
After knowing all those things about it, you should ask yourself ‘Is it worth taking a personal loan?’. If the answer still comes, you may go for it. Now before you make any decision about a personal loan, let’s know both the good and bad sides or pros and cons of a personal loan.
Pros
Fast processing
There are many things in a personal loan, which may attract many of the applicants to go for this loan. One of the best aspects of taking a personal loan is its fast processing. When you apply for any other type of loan, most of the time is spent on the approval of the loan and you get the loan after many days of your application. Due to this all delay, Sometimes the applicants receive the amount of loan when they already have taken any personal loan instead. Therefore, if you want to receive the loan amount soon and soon, a personal loan could be the best option for you.
If you apply for such a loan in Singapore, then the processing time gets even reduced more. To grab this opportunity of faster loan processing, you may ask yourself first ‘ do I need a personal loan Singapore‘ and once you be sure, you can go for it
Least documentation
Above we discussed that personal loans take less processing time than any other type of loan. Do you know why this happens? The other different types of loans like business loans, educational loan, etc. ask you some of the required documents which show that you really need that particular loan and the amount of loan is also mentioned in that type of document many times. Along with that some personal identity proof and the residential proof of the applicants is asked for those loans. And that is the reason, such loan processing takes more time as it takes a lot more time to verify the detail of the documents.
In a personal loan, you don’t need to show any such documents and that is the reason the processing time in the personal loan is quicker than the processing time in any other loan. Therefore, if you are searching for a loan with less processing time, you may go for a personal loan. One of the best such types of personal loans are easily available in Singapore too which you can search on the web very easily. There on the web if you type ‘how to get personal loan in Singapore‘. The result of the best personal loan offers would be displayed there.
No Credit issues
When you go to take any other type of loan you may need to have a very good credit score. In the case you don’t have a good credit score, your loan application may get rejected. In such cases, a personal loan could be the best option for you. For taking a personal loan, you don’t need to show your credit score to the bank. Many of the banks even give personal loans to people whose credit score is low and the bank knows about that. With the help of such a personal loan, you can even be eligible for the other type of loans again. That means you can get the chance of increasing your credit score just by taking any personal loan and repaying that loan within the time.
Cons
Just like the pros of personal loans, there are some cons of it also. Some of the major cons which you may find in a personal loan have been discussed below.
High rates
When we apply for any other loan like a business loan, education loan, etc., we don’t have to pay a large percentage of interest. However, the same situation is not there when you take a personal loan for any reason. The rates of interest in a personal loan are generally higher than the other type of loan. The reason behind this is the facility it provides which we have discussed above already. That is why if you ever go to take a personal loan, you should check its interest rate first. If you find that the interest is considerable enough to say yes to the loan, only then you should take that personal loan.
No prepayment possible
In many of the cases, it has been seen that people who have taken any personal loan find themselves in a good financial position again and want to repay the full money of the loan before the scheduled time. This is not applicable in the case of a personal loan. If you still want to repay that loan, you may have to bear some extra cost on that too. Therefore, before you apply for taking any personal loan you should also check whether the prepayment possibility is there or not. In case you don’t find such a facility, you should rethink taking that personal loan.
Processing fee
Most of the personal loans are quicker than the other different types of loans as we discussed above too. However, to start the processing of the personal loan, many of the companies and banks may ask you for some processing fee. This processing fee may be somewhere between 7 to 11 percent. So, if you want that you would get the entire loan amount without any processing fee deduction, you should go for any other loan or you should take the loan of some higher value so that even after the deduction of the processing fee, you could get the required amount.
With the help of the above discussion, it must be clear to you whether a personal loan can be a worth taking loan or not.
