5 Factors A Credit Company In Singapore Considers When Lending Money

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Whenever people need money for whatever reason, be it emergency hospitalisation, school fees, or vacation, they seek one place— a credit company in Singapore.

Credit companies provide people with different kinds of loans, including personal, auto, and business loans. But getting qualified for a business loan in Singapore or any loan type can be a complex process. Why? Because credit companies consider multiple factors before determining whether or not the applicant is eligible for the loan and how much they are willing to lend to the applicant.

Here are the most common factors credit companies consider when qualifying an applicant for a loan:

1. CAPACITY TO PAY

Credit companies are reluctant to grant loans to people without the capacity to pay. How do credit companies determine whether a person has the financial capability to get a payday loan in Singapore?

Credit companies usually check your annual income. They will also want to know your employment history. Financial institutions will also evaluate your outstanding debts and compare them to your income.

2. CREDIT HISTORY

The next thing a credit company will consider is credit history. A credit history is a record of your previous and current debts. The credit history contains information such as your past credit companies, the type of credit applied for, and payment history. A credit history can be measured using a credit score.

A high credit score means you are a diligent borrower who pays off the loan on time or earlier. The risk is lower for people with higher credit scores; therefore, credit companies are most likely to approve their home renovation loan in Singapore.

3. COLLATERALS

The two primary types of loans credit companies give are secured and unsecured. Secured loans are borrowed money that require collateral from the borrower. A collateral is any item that holds value, such as a vehicle, house, prized artwork, and more. The credit company can seize these valuable items when the borrower fails to pay off the secure loan.

On the other hand, an unsecured loan is a loan without collateral. Most credit companies look into your potential collateral before granting loans.

4. CAPITAL

Capital refers to other income channels and forms of financial support other than the primary job. It can be savings, trust funds, investments, and business. These assets can be used to pay off loans if the borrower loses their primary job.

5. CONDITIONS

As mentioned there are different types of loans. Credit companies want to know where you will use the money. Will it be for business? Vehicle? Perhaps, a debt consolidation loan in Singapore?

Be mindful of these factors when applying for a loan.

Are you looking for a credit company in Singapore? Visit Monetium Credit (S) today.

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