It can be hard to keep up with late payments on a single credit card, but it’s even more problematic when you’ve piled significant debt with several lenders. There are far too many due dates and repayments to keep track of, and the constant barrage of alerts about your unpaid balance just adds to your worry. The longer you go without paying, the greater your debt gets. A debt consolidation loan in Singapore might be beneficial in such situations.
Singaporean families have an average debt of Singapore $55,112 per head, according to Singapore’s Department of Statistics. This can be a worrying statistic, especially given that the country’s quality of living continues to increase year after year.
Many business entities and individuals borrow loans and owe money to numerous creditors with varying interest rates and periods. As a result, some individuals and businesses are having difficulty repaying their loans and credit commitments. People frequently make hasty decisions, such as filing for bankruptcy and defaulting on their bills. These are realistic solutions, but one should always consider alternatives before making impulsive decisions.
Such decisions generally influence your credit rating and your ability to get further loans in the future. If you find yourself in an undesirable tough spot like this, seek a debt consolidation loan in Singapore from a reliable licensed moneylender.
What is a debt consolidation loan in Singapore?
A borrower usually takes a consolidation loan in Singapore under the Debt Consolidation Plan (DCP). It allows the borrowing party to consolidate multiple loans into a single, larger loan facility.
This type of loan covers all current credit card debts and bank loans with a lower interest rate advantageous payback terms, a lower monthly payment, or both.
One can repay the loan in automated monthly installments, similar to a personal installment loan, for a period of up to ten years.
The Debt Consolidation Plan (DCP) was introduced by the Association of Banks in Singapore (ABS) in the year 2017. It was particularly intended for Singaporeans and Permanent Residents juggling numerous high-interest unsecured loans and having trouble meeting payments.
There are two primary categories of debt consolidation loans:
Secured Loans
Secured debt consolidation loans employ the debtor’s current assets as security if the debtor cannot repay the loan on time. Secured loans usually have reduced interest rates than unsecured loans and average credit card rates.
Unsecured Loans
Unsecured loans do not require collateral. However, the interest rates are significantly higher than for secured loans. Unsecured loans are harder to get, and you will be expected to give additional proof of financial stability.
Here are some ways you may do to handle your debts more effectively:
- Carry out your financial inventory
- Keep track of your cash flow
- Sell assets to minimize your debt.
Why choose a Debt Consolidation Loan?
Aside from assisting you in repaying various unsecured debts, a debt consolidation loan provides additional benefits, making it an obvious choice to consider a Debt Consolidation Loan.
The debt consolidation loan is an extremely useful tool for people with multiple debts hovering over their heads along with high interest rates or monthly payments. It is especially applicable to individuals who owe $10,000 or more.
Since these loans facilitate negotiation, one can benefit from a single monthly payment rather than multiple payments and a lower interest rate. The debt consolidation loan in Singapore might decrease calls or letters from collection agencies if the new loan is done in conjunction. You can expect to be debt-free sooner if you do not incur additional debt.
General Eligibility for Debt Consolidation Loans in Singapore
Debt consolidation programs are only accessible to Singaporeans and Permanent Residents. However, the borrower has to qualify for the requisite income and creditworthiness, particularly if adjusting to a different lender. You must be a paid employee earning between $30,000 and $120,000 per year to be eligible. You must also have outstanding interest-bearing liabilities on unsecured credit facilities totaling at least 12 times your monthly income.
Aside from eligibility, some documents are necessary. The conditions for debt consolidation loans will differ based on the lender you approach. However, the following papers would almost certainly be essential if you wish to apply for a debt consolidation loan in Singapore.
- Income proof/ Details of employment
- Credit history
- Equity
- Current living expense list
- List for existing debts ( also includes the terms of the debt )
Ensure you have these criteria ready before visiting a licensed moneylender in Singapore. You will have a faster procedure for your debt consolidation application if you’re doing it. Once you’ve established your debt consolidation strategy, think about who you’ll pay off first. In many situations, the lender chooses the order in which the borrowing party’s creditors are reimbursed. If not, prioritize paying off your highest-interest loan. Because of contemporary digitalization, everything has shifted online. Still, many people find themselves unaccustomed to online procedures. Online credit services from reputed moneylenders can indeed be the ultimate solution for such borrowers in Singapore.
Convenient debt consolidation loan in Singapore using OnlineCredit services
On-Line Credit Pte Ltd is a Singapore-based licensed moneylender. It is an independent financial services firm. On-Line Credit Pte Ltd has provided credit and financial services to countless happy clients in need of financial assistance since 1998. We realize how difficult it is to manage several debts in Singapore. This aspect is why we provide debt consolidation loans to those who need to simplify their debt payment plan. You won’t have to stress about maintaining constant track of several payment dates, interest rates, and loan terms if you work with us. We are the recommended Moneylender in Bedok because we provide excellent services and allow proper loan clarification.
Our moneylending approach ensures that you have a wide choice of financing options, an approval speed that will not cause you to fail on your obligation, and interest rates reasonable for everyone concerned. Allow us to assist you in paying off your debts on schedule!
For additional information, please get in touch with us.
