What Is An Urgent Emergency Loan And What Can I Use It For?
March 9, 2021
Your car broke down, and you can’t get to work. Your home rental is due, and your landlord will kick you out if you missed the payment. You’ve been working long hours, so your chronic back pain is flaring again.
All these problems require quick cash. Unfortunately, banks take days if not weeks to approve applications. That’s if you’re lucky enough to have a good credit score and high income.
The best solution for your needs is an urgent emergency loan. But you have to apply smartly.
In this article, we’ll tell you more about how urgent loans compare to other types of loans so that you’ll get the best value for your money. We’ll also discuss how much you can get, the required paperwork, and what to do if a bank rejects your application.
Of course, if you’re already certain that you want to get a quick loan, you can apply here!
If you want the best, fastest solutions to your problems, read along!
What Is An Urgent Loan?
Urgent loans are fast loans with short-term tenures that most people opt for during emergencies. Quick cash solutions to help you tide through!
An acute financial crisis needs quick solutions, not lengthy bank bureaucracy. So, if your credit score isn’t great, consider an urgent loan.
Compared to other types of loans, you can use your emergency loan for various purposes without explaining it to your lender.
Sure, urgent loans grant you smaller principal amounts than personal loans, but larger sums than pawnshop or credit card loans. Besides, licensed moneylenders and banks in Singapore offer regular instalment plans, with convenient repayment schemes.
What Are The Types Of Urgent Loans?
1. Personal Loans
Many financial institutions in Singapore offer quick personal loans that are similar to urgent loans. You can consider this option if you have a good credit score, need more cash, and don’t mind waiting a few extra days.
Personal loans are funds you borrow from a bank or licensed moneylender. You’ll have to repay this sum with interest, in regular instalments, within the established period.
However, you’ll need to pass stricter eligibility requirements, such as steady income and good credit score. Another disadvantage is that some banks in Singapore won’t offer personal loans to foreign citizens.
For loan applicants who are rejected by banks, they can consider getting a personal loan from reliable licensed moneylenders like Credit Thirty3!
2. Credit Card Advance Loans
Cash advance loans are funds you can get from your credit card, according to your available balance. That means you can withdraw money from your local ATM in a few minutes, without submitting any documents.
While credit card advance loans are really fast, it is not advisable because of their notoriously high interest rates.
Credit card interest rates range from25% to 29% per year, which is extremely high compared to regular financial institutions. Credit card loans can also make your debt snowball because you’re always tempted to get more from your credit card.
That’s why most specialists don’t recommend this type of loan unless you can be very diligent with your balance and repayments.
What Can I Use An Urgent Loan For?
People need urgent loans for different reasons. For instance, you might want yours to consolidate pre-existing loans and become debt-free. Others wish to renovate their homes or pay for an urgent medical bill.
Below are the most common reasons to get an emergency loan:
- Paying late bills
- Urgent home repairs or disinfection
- Paying advance rent when you need to move quickly
- Car repairs
- Education / tuition fees
- Pet surgery
- Medical issues
- Refinancing debt
- An unexpected funeral
- Unforeseen trip
- Starting your emergency/ savings fund
This list can go on forever, but here’s something else to consider: why get an urgent loan instead of other types of loans?
- Quick approvals. Urgent loans are faster than conventional personal loans at banks, which have lengthy approval processes. Even quick personal loans from banks take a couple of business days to be processed. By comparison, an urgent loan can be approved in an hour. You can easily apply for one here.
- Low interest. Compared to cash advance, or pawnshop loans, urgent loans have lower interest rates.
- Less bureaucracy. Urgent loans have seamless processes because they grant you smaller amounts than other personal loans. The best news is moneylenders ask you for less paperwork and don’t care as much about your credit score.
How Much Can I Borrow For An Urgent Emergency Loan?
You probably have a lot of questions at this point regarding how much you can borrow and the factors that affect the maximum available sum.
Here’s a well-guarded industry secret: Only borrow a sum you can repay.
The other factors we’ll discuss below are secondary, but also significant:
Usually, you can borrow four to six times your monthly income for urgent emergency loans.
The logical conclusion is: The bigger your income, the more you can borrow.
However, some financial institutions enforce a minimum annual income of $20,000-$30,000. So, choose your provider carefully.
Your Credit Score
People with good to excellent credit ratings can borrow more money because they’re less likely to default on their loans.
Here’s how your risk grade and the probability of default correlate with your credit score:
|Probability of default|
|Credit score||Risk grade||Min||Max|
You can improve your credit score by changing your financial habits. For instance, you can start repaying your bills on time, close some credit lines, and learn better money management.
These changes take time, and they won’t modify your rating immediately. However, document any small step in the right direction, such as enrolling in credit counselling. This shows your moneylender that you’re determined to repay your loan diligently.
Who Can Apply For An Urgent Loan In Singapore?
Some banks have stricter eligibility requirements, such as:
- Be at least 21 years old
- Be maximum 60-65 years old
- Have a minimum salary of $20,000-$30,000
- Be a Singapore citizen or PR
By contrast, moneylenders have fewer rules, which means they’re more likely to offer you an urgent loan. Here’s how much you can borrow:
- Maximum $3,000 if your yearly income is below $20,000
- Maximum 4-6 times your monthly salary if your yearly income is over $20,000
How Do I Apply For An Urgent Loan Now?
Getting an urgent loan in Singapore is easier than you think! With technology, you can apply for one within minutes here.
How Do I Choose The Right Urgent Loan?
Although all urgent loans are unsecured, short-term, and quick, not all are created equal. Here’s what you have to consider before choosing your loan provider:
1. Maximum Amount
Ensure the loan you’re choosing covers all your needs. For that, you have to calculate the maximum loan amount according to your salary and credit score.
Pro tip: Don’t apply to a loan just to see how much you’ll get because multiple applications lower your credit rating. Suppose you have doubts, e-mail or call your loan provider.
Tenure is an essential factor because longer repayment schedules feature lower rates and more flexibility. Conversely, shorter terms allow you to get out of debt faster and with a lower repayable amount.
Pro tip: A lengthier loan can improve your credit score if you make consistent repayments. The reason is that you’re showing your diligence and responsibility as a customer.
3. Interest Rate
Your interest rate affects your monthly instalments and the total loan amount you’ll have to repay. But here’s the gist:
Lower interest rates aren’t necessarily better.
Of course, absurdly high-interest rates aren’t all right either. That’s why moneylenders in Singapore can’t ask for more than 4%/ month in interest.
But consider your interest rate depending on the maximum amount and tenure. If you need to borrow more money or prefer a shorter term, you will have to pay higher interest rates. Don’t settle for a smaller sum or too-tight repayment schedule just because it’s low-interest.
Pro tip: Use an online calculator to compare lenders’ interests, tenures, and other conditions. You can also visit these moneylenders’ websites for more information.
Check your loan provider’s online reviews and choose one with high customer satisfaction. Make sure your moneylender is expert, flexible, and friendly.
Read their Google Reviews to find out how they treat their customers. Google Reviews are public platforms so most of the feedback is true. If you ever need to restructure your loan or miss a few payments, you’ll want someone who’s always looking for the best solutions.
What Are The Documents Required For An Urgent Emergency Loan Application?
If you’re a Singapore citizen or permanent resident, most banks and moneylenders ask you for these documents:
- Proof of identity (NRIC)
- Proof of residence
- Proof of income
Luckily, some moneylenders allow you to apply in minutes by simply uploading your SingPass data on their website.
If you’re a foreigner, you might need to send more documents, such as:
- Proof of having minimum $2,000 salary
- Work permit
What If My Loan Application Is Rejected From Banks?
If your application gets rejected, avoid panicking because it leads to rash decisions. Unfortunately, a lot of Singaporeans with multiple loan refusals believe loan sharks are their only solution. Do not borrow from loan sharks and avoid falling into loan scams! Here are examples of loan scams in Singapore.
Remember: Loans sharks are dangerous people that practice extortion, harassment, and physical violence. They’ll also demand high-interest rates so that your debt will snowball.
If banks don’t approve your application, you can:
- Ask a friend or family member
- Pawn or sell some of your things
- Get a second job or freelance
- Enrol in credit counselling
- Try a peer-to-peer lending platform
- Enlist on a website where strangers offer donations
However, the best solution is to apply for an urgent loan from a licensed moneylender. We’ll tell you why below:
Why Should You Apply From Licensed Money Lenders In Singapore?
Moneylenders are the best solution because you’ll get faster cash with low interest, and no hidden strings attached.
By comparison, peer-to-peer platforms or pawnshops practice excessive interest rates. A second job, asking for donations, and credit counselling takes a lot of time. Lastly, borrowing from friends and family may trigger some shame or extra scrutiny from them.
Pro tip: Check Ministry of Law’s list of licensed moneylenders before choosing one. Also, never respond to unsolicited loan offers you get via e-mail, text, or flyers because only loan sharks advertise this way.
That said, here’s why you should choose Credit Thirty3:
Applying with us takes minutes, and we’ll analyse your request within the hour. Courtesy of a streamlined, bureaucracy-free application process, you can get your cash quickly.
If we can arrange an in-person meeting at our office to check your paperwork, you can have your money within an hour.
Higher Chances Of Approval
Your credit score isn’t essential for us. If your rating isn’t that good, we can discuss various loan options to ensure none of us gets the short end of the stick.
Instead of focusing on your past financial history, we focus on the future. We value your honesty and your ability to repay your loan.
Thus, our expert agents are dedicated to getting you the best-customised loan packages for your needs.
Most of our competitors practice flexible tenures depending on your need. That means you can choose the repayment plan that fits your income, lifestyle, and principal loan. Remember that making timely payments is essential.
With us, you can choose from a slew of repayment schemes, but listening is our leading quality. Thus, our expert staff offers professional counsel in case of a missed or late payment..
Ready to apply with us? Simply click here to get the best financial help you deserve!