Whenever you borrow money, it comes at a cost. Borrowers are often charged interest for taking a loan out or carrying a balance on their credit cards. However, there could also be other fees involved, too. Therefore, when you need to borrow money, it’s best to do so affordably. This means understanding what interest rates are and researching to get the right deal.
Personal loans are installment credit, so you pay interest on the money borrowed until the balance is $0. If you choose to take out such a loan, you want to ensure you’re borrowing at an affordable rate for which you qualify. Generally, a personal loan in Singapore has an interest rate of 9.34 percent or lower is exceptionally good. Since credit card APRs can be almost double that, it could be best to use a loan to pay for a large purchase.
The interest rate you pay on the personal loan is decided based on your income, credit history, credit score, and the loan’s term and size. Some factors are out of your control.
When searching for a personal loan, it’s best to compare different offers to find the best rates and payment terms.
In all likelihood, you can expect to pay more than five percent for your interest rate, but it’s good to ensure that they don’t contain early payoff penalties or origination fees. Sometimes, you might find a loan offer for a very low interest rate. These are usually reserved for those with good credit, so make sure to look at the average or highest interest possible.
With Standard Chartered, you get an interest rate of just 3.48 percent, but the effective interest rate is 7.3 percent. That’s the real return on an investment when compounded over time. In fact, this is the real percentage rate you own on a loan, so it’s best to look at that number.
You may take out up to $10,000 with a three-year term. If that’s the case, you end up paying $1,044 in interest with a monthly installment of $307.
The HSBC Personal Loan comes with a 3.4 percent interest rate, though the effective interest rate is 6.5 percent. The total amount allowed is $10,000 for a three-year term. This means that the interest you pay is about $1,020, and you pay $306 a month.Also read: Best CRM software for 2021
If you’re a new loan customer with Citibank, you can get a 3.45 percent interest rate (6.5 percent EIR). There are no processing fees, and loans come in one- to five-year terms. However, to qualify, you must already have a Citi credit card or Citibank Ready Credit account.
Another great option for Singaporeans is the UOB personal loan. With a 3.4 percent interest rate (6.42 percent EIR), you can expect to pay $306 per month for a $10,000 loan. This is a flat interest rate, so it means that you never spend more on interest each year.
If you’re looking for the best personal loan interest rates in Singapore, it’s important to research the many loans available. The ones listed earlier are just a small portion, and it’s best to compare the terms and options before deciding.
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