Once you have borrowed from a licensed moneylender in Singapore, the next big step is to determine how well you will repay your loan.
Paying a loan off doesn’t just mean clearing off debt but also a sense of financial discipline and building a good rapport with your money lender.
Ways to Repay a Loan from a Licensed Moneylender in Singapore
The following steps will help you repay the loan and build a positive credit score for future borrowing.
Understand the details of your loan
First, you should know what you have gotten yourself into. You understand more about the loan by going through the contract. The licensed money lender will show you the repayment schedules, applicable interest rates, and late repayment fees.
Go through the contract line by line. Whatever sounds blurry may need your calling to clarify during this time. That way, you will avoid particular ‘surprises’ since you will be informed precisely what to expect from yourself.
Stick to Your Repayment Schedule
The best way to pay for a loan is with an agreed-upon repayment schedule. A good and licensed moneylender in Singapore can provide a workable monthly installment schedule that falls between the given dates of the month.
Non-compliance to the given schedule may include late fees aside from the damage it causes to your credit history. Therefore, commit to paying promptly by setting reminders or even automating the repayments from your bank so you won’t forget such a due date.
Budget to Stay on Track
Importantly, you will have to budget your repayment to afford it. You can do this by enumerating your monthly income and expenses, after which you will have to set aside a certain amount of money as repayment of the loan.
Notably, you should avoid spending more than necessary. If necessary, you may have to eliminate discretionary spending, have fun buying things you do not need, or go out until you pay your loan.
Talk to Your Lender If You Have Trouble
Life is unpredictable, and at some point in your life, you may experience a financial problem. Therefore, if it happens you are unable to afford loan repayment, you should just call your lender right away.
Most licensed money lenders in Singapore are more considerate than you could ever imagine. Some will be ready to change the payment terms for a certain period if you make them believe you are serious about returning the loan.
Avoid Late Payment Charges
A dollar saved in interest or fees is another step toward financial freedom. Notably, the only way to avoid late payments is to pay your installments on or before the due date.
Some moneylenders even give incentives for early repayment, which is worth checking on.
Consider Paying Off Your Loan Early
Most licensed money lenders in Singapore allow you to pay the loan in advance without penalty.
Therefore, if you get a financial windfall, such as a bonus or tax refund, use the same to pay off the loan in advance. It saves you a lot of interest money and gives you peace of mind since the debt is fully paid.
Conclusion
Repaying a loan from a licensed money lender in Singapore does not need to be stressful. You can plan to prepare by taking into account the above steps. Importantly, you can contact your licensed moneylender and work closely with them for a smooth loan repayment process.
Lastly, responsible loan payment is a journey worth mastering since it lets you control your financial health. Importantly, it depicts an improved financial reputation, offering a good premise for better money management.