Personal loans are a type of secured loans that can be available even to people with low credit score. This is one of the most popular types of loans in the Philippines. They are ideal for people who need money for personal reasons, but have little or no collateral for security to offer the lender. Yes, personal loans can also be available for people with bad credit.
Personal loans offer Filipinos the chance to borrow money from banks and other institutions for a short period of time – usually one year- with interest rates estimating from 1.5% to 20%. Interest rates depends on the offer of the lenders.
If you would like more information on getting a personal loan in the Philippines, read on! We will explore how personal loans work and how you can secure one!
Personal Loans Options for Filipinos to Get Cash Now
The need for immediate cash is a requirement that more and more Filipinos are finding difficult to meet. It’s either they don’t have enough money coming in or just don’t have any savings. Whether it’s school tuition for children, paying off medical expenses, or just living expenses, Filipinos need fast cash and these new personal loans could help them get it.
With the introduction of new technologies, Filipinos can now access to personal loans that can provide quick cash and instant funds. They can either apply for a loan online or through a mobile app.
The most popular personal loan in the Philippines is SSS Salary Loan. Often with this loan, the borrower can easily apply for it in the SSS website and have their company HR approve the loan. Once approved, SSS will have a check shipped to the borrower’s work address. SSS personal loan interest rate is at 10% per annum.
You may also try personal loan apps that can be downloaded if you’re unsuccessful in securing a personal loan from banks or SSS. But be sure to read the reviews before deciding to use some of these apps. Make sure to also do a background check on these apps for your security. Look for real reviews of people online regarding their services and it would also be smart to check how long these businesses have been operating. Check for any histories of legal battles.
How Much Do You Qualify For When Applying for a Personal Loan?
The qualifications for a personal loan depend heavily on your credit score, your income, and the type of loan that you are applying for. Banks can look into your savings account and credit card usage history to analyze how much would be ideal for you to borrow.
If you have been living in the same place for more than 2 years and have a good credit score, then you may qualify to borrow from PHP5,000 to PHP2,000,000 in a personal loan. If you don’t meet these requirements or need a higher amount of money then you might need to apply for a secured loan.
What are the Differences Between Secured & Unsecured Loans?
A secured loan is a type of loan that requires some form of collateral. The collateral can be in the form of real estate, stocks, bonds, car titles or anything else that is deemed valuable.
This means that the lender will take this collateral if the borrower defaults on their loan. This is because they know they will get something back to cover their losses.
An unsecured loan does not require any collateral and has no guarantee for repayment if the borrower defaults on their loan. Often, these unsecured loans lend relatively small amount of money that can come with high interest rates such as “payday loans”.
What are the common requirements for Personal Loans in the Philippines?
There are of course some requirements before getting approved for a loan. Lenders would often ask for these:
- 2 Valid Id’s such as unexpired driver’s license or passport
- Certificate of Employment
- SSS number
- TIN
- Police clearance or NBI clearance
How To Negotiate (if possible) The Best Deal on Your Personal Loan Interest Rates?
Interest rates can make a huge difference to your personal loan. Some lenders are open with negotiating their rates. Here are some basic tactics to negotiate the best deal that suits your needs.
1) Ask for a rate quote from a number of lenders for comparison on what you’re being offered with what they’re offering.
2) Get pre-approval from the lender before checking on other offers for the best deals as this will save you time and effort as well as help you avoid hidden fees.
3) Find out about any hidden fees or charges that may apply, including application or processing fees, contract penalties or late payment penalties. If you have a good credit score, ask for a lower interest rate and don’t be shy to ask for fee waivers.