Where To Get A Short Term Loan In Singapore

Wondering what a short-term loan is and where to get a short term loan? If so, you have come to the right place.

 

Singapore is home to several different lenders offering short term loans to individuals and businesses needing quick cash.

In this article, we will explore the different short-term loans available in Singapore and where to get a short term loan.

With this information in hand, you’ll be able to make an informed decision about which type of loan is right for you.

What Is A Short-Term Loan?

This is a loan that you need within a short period, usually from one to 12 months. The loan usually costs between $100 and $100,000. It can help you meet short-term cash needs, cover unexpected expenses, or pursue investment opportunities.

It is also an unsecured loan, meaning no collateral is required to secure the loan. The loan is repaid in one lump sum at the end of the loan tenure.

In addition, the loan is also acquired fairly quickly, providing the required funds without prolonged delays.

Short-term loans come in different forms such as invoice financing, merchant cash advances, bridging loans, and payday loans. It is always best to weigh the pros and cons of taking out a short-term loan before making any decisions.

Pros And Cons Of Short Term Loans

Before getting a short-term loan or thinking about where to get a short term loan, it’s crucial to evaluate the pros and cons carefully.

Pros

Flexibility

Short-term loans tend to be flexible to borrowers and are ideal for those unable to commit to long-term loans.

These loans have shorter repayment periods and are designed to provide quick access to funds. This makes them ideal for those who need to cover sudden expenses or to bridge a financial gap.

Ease Of Application

Applying for such a loan can be a relatively simple process. The loan is approved quickly, allowing you to access the funds faster.

This is especially useful if you need to pay for urgent expenses and can’t afford the time that a longer loan application process would require.

Accessibility

Short-term loans are usually accessible, allowing you to apply for the loan quickly and easily. The convenience of online applications and a wide range of lenders allows you to compare different providers and find the best loan product that suits your needs.

Moreover, it lets you access the funds quickly. These loans are, therefore, one of the most accessible types of credit at any time.

No Credit Check

The loans often only require a partial credit check. It benefits those with a bad credit rating, allowing them to access funds without worrying about their low credit score.

This makes it easier for those who may have had difficulty accessing other forms of credit in Singapore to obtain the funds they need.

Cons

High Interest Rates

A short-term loan often comes with higher interest rates than a long-term loan due to a shorter loan period. This is because these loans are considered a high-risk form of credit.

Taking short-term loans should be done with caution; you should only take the loan if you’re able to repay the loan in full and on time.

Extra Charges

The loans also include other charges such as processing fees, origination fees, and early repayment fees. These charges can add up and make the loan more expensive.

Opportunity For Loan Sharks

This loan can be a target for a loan shark who may offer loans with sky-high interest rates or impose unrealistic repayment periods.

You should always be wary of these lenders. Make sure you research the lender in Singapore before taking a loan.

Types Of Short-Term Loans In Singapore

Line Of Credit

A line of credit works by giving borrowers access to a pre-approved amount of funds that can be used as needed up to an approved limit. You only pay interest on the money borrowed, not the full pre-approved amount.

Regarding short-term borrowing options, lines of credit often offer more favourable terms than alternatives such as payday loans or cash advances.

For example, they have a lower interest rate, and a higher credit.

Invoice Financing

This allows you to leverage your unpaid invoices as collateral to obtain short-term funding. In simpler terms, invoice financing allows you to access funds by using your outstanding invoices as security.

There are two types of invoices.

Invoice Factoring

Invoice factoring is where businesses trade their unpaid invoices to a lender, who, in exchange, provides cash upfront at a reduced value. The lender, a factoring company, collects payments from the business’s customers.

Accounts Receivable Financing

Accounts receivable financing is a loan option where a lender extends funding to a business based on the value of their outstanding invoices. The lender then takes on the responsibility of collecting payments from the business’ customers on their behalf.

Bridging Loans

A bridging loan is a short-term funding solution that fills the time gap between buying a new property and selling an existing one.

This loan enables you to purchase a new home before selling their previous residence. It’s a popular choice if you want to use the loan to relocate or buy a property through auction.

Merchant Cash Advances

A Merchant Cash Advance (MCA) is provided to businesses in exchange for a percentage of their future credit card sales. This type of financing is often used by small businesses that need help obtaining traditional bank loans.

Payday Loan

A payday loan is a type of short-term loan typically used by those who need cash quickly. These loans are intended to be repaid on the borrower’s next pay day.

Payday loans are typically fully repaid along with interest and fees on your next paycheck. Making all this money available at once can be difficult, so before applying for the loan, be sure you can repay.

The interest rate is high, and the repayment terms are very short. This can make it difficult to pay back the loan on time.

Online Or Installment Loans

These are types of short-term loans that can be applied for and approved online.

The loan repayment plan of an online or installment loan is typically structured to allow you to pay off the loan amount in small, manageable payments.

The repayment schedule is flexible and can be adjusted to best suit your financial situation.

Personal Loans

These are loans from a money lender or bank. It is designed for those who need funds for personal or business expenses.

Personal loans can be used for large purchases such as a house or car, or smaller, more immediate needs.

Personal loan interest rates vary depending on the lender but are generally higher than long-term loans. Short-term personal loans in Singapore are repaid within a year.

When looking for the best personal loan, it’s important to compare the interest rates, fees and repayment terms of the loan of different lenders to find the one that best suits your needs.

Where To Get A Short Term Loan In Singapore

Banks

are the best place to obtain all kinds of loans, from business credit cards to personal loans.

When applying for this loan, banks are your first option to opt for a loan since a short loan from a financial institution like a bank has a low interest rate.

Banks provide various loan products with varying interest rates, loan amounts, and repayment terms. When applying for a loan, the main factors to consider are the interest rate, loan repayment schedule, and the terms and conditions of the loan.

Popular banks offering this type of loan in Singapore include DBS Bank, United Overseas Bank, OCBC Bank, and Standard Chartered Bank.

Licensed Money Lenders

If you need immediate financial aid, obtaining a loan from a licensed money lender is one possibility. The Ministry of Law regulates these institutions.

They must follow strict regulations established by the Moneylenders Act, ensuring they cannot charge excessive interest rates or fees.

In addition, they must always provide transparent information about the loan terms and conditions. Licensed money lenders in Singapore have higher interests than banks but tend to have more lenient requirements to obtain a loan.

Private Funders

These funders have more flexible requirements for loan approval and can provide funding more quickly. Singapore has a large number of private lenders that can lend money to individuals and corporations.

An Individual

To be considered an accredited investor, an individual must have net personal assets of more than $2 million, a primary residence valued at no more than $1 million, earnings in the preceding 12 months of at least $300,000, or net financial assets of at least $1 million.

A Corporation

On the other hand, corporations must have more than $10 million in net assets to qualify for private funding. These qualifications must be met for an individual or corporation to obtain a loan from private funders.

It is also important to remember that private funders are not regulated by the MAS. As such, there is the only protection for borrowers if things go right. Therefore, it is important to only borrow from a reputable and trustworthy private funder.

How To Select The Best Short Term Loan

When choosing these loans, consider the following:

  • Interest rate: Compare the loan interest offered by different lenders to find the best deal. Look for loans with low interest rates and fees.
  • Credit history: Check your credit score and credit history to make sure you are eligible for a loan and understand how it will affect the interest rate.
  • Reputation: Research the lender’s reputation and read reviews from other customers to ensure they are trustworthy and have a good track record.
  • Look up multiple options: Compare the terms and rates of different loan providers to find the best option.

These loans should be used with caution, as they come with high interest and can lead to a debt cycle if not managed properly.

Finding The Right Short Term Loan Provider

To know where to get a short term loan, consider different lenders and compare their terms to find the best loan if you need a loan. You can also use online comparison tools or consult a financial advisor to find the best lender for a loan.

Ultimately, it is important to thoroughly research where to get a short term loan and pick the lender that best suits your needs.

After all, we all deserve access to financial services. That’s why Horison Credit offers fast loans so everyone can get the help they need.

Take control of your finances today. Our loans are fast, easy, and secure.

Contact us to find out how to get your short-term loan faster and at affordable interest rates, or apply for a loan with us now.

 

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