When looking for a personal loan with a low interest rate, keep in mind a few
important factors before sending your application. For example, planning to take
a major loan such as home loan, auto loan or education loan within a period of 2
to 3 months of taking a personal loan is not recommended. DSR or debt servicing
ratio is one of the factors that needs to be looked at before applying for an
auto loan. DSR is the calculated percentage of your income that can be used to
pay monthly installments for loans, such as auto loan or personal loans.
Now having a DSR percentage of 50 can severely hamper your capacity to repay the loan. Ideally your DSR percentage should never be more than 50 percentage. So if you apply for more personal loans, then you might have to reduce the amount of loan taken for your major goals such house and a car. Nearly all banks offer a DSR percentage of 40 for home loans and 30 for auto loans.
However, if there is no way out other than taking a personal loan before taking a major loan, may be to pay the down payment for the major loan, then the timing is absolutely critical. Seek help from a loan specialist, who can advice you on the correct move.
This rule does not apply to HDB loans, which has a capping of 35 percentage over MSR or Mortgage Servicing Ratio. So basically having other loans does not affect HDB loans, repayment of which should be 35 percentage or below your total salary. So taking a personal loan before a HDB loan doesn't affect the HDB loan in any way.
Compared to personal loans these loan packages have a much lower interest rate. Education loans for example are available for as low as 2 percent which is much lower when compared to a 6 to 8 percent interest rate of a personal loan.
Profitability of a bank is based on charging interests. A bank looking for new customers is much likely to offer lower interest rates and try and attract new clients with flexible repayment plans. Try and look for banks that are aggressively searching for new clients and get business they might just offer you lower rates and added benefits. When two or more banks offer the same, choose the bank that has lower penalty rates. Following these factor makes sure that you have personal loan that has a lower interest rate and comparatively lower penalty rate.
Article refer: http://personal-loans.sg/how-to-find-the-best-low-interest-personal-loan/
Now having a DSR percentage of 50 can severely hamper your capacity to repay the loan. Ideally your DSR percentage should never be more than 50 percentage. So if you apply for more personal loans, then you might have to reduce the amount of loan taken for your major goals such house and a car. Nearly all banks offer a DSR percentage of 40 for home loans and 30 for auto loans.
However, if there is no way out other than taking a personal loan before taking a major loan, may be to pay the down payment for the major loan, then the timing is absolutely critical. Seek help from a loan specialist, who can advice you on the correct move.
This rule does not apply to HDB loans, which has a capping of 35 percentage over MSR or Mortgage Servicing Ratio. So basically having other loans does not affect HDB loans, repayment of which should be 35 percentage or below your total salary. So taking a personal loan before a HDB loan doesn't affect the HDB loan in any way.
Beside the DSR there are other important factor that needs to be considered before taking a personal loan
You need to be specific when applying for a personal loan. Taking a personal loan to do a house renovation or to fund college education or a vacation is not good idea, as there are tailor made loan packages for these.Compared to personal loans these loan packages have a much lower interest rate. Education loans for example are available for as low as 2 percent which is much lower when compared to a 6 to 8 percent interest rate of a personal loan.
Profitability of a bank is based on charging interests. A bank looking for new customers is much likely to offer lower interest rates and try and attract new clients with flexible repayment plans. Try and look for banks that are aggressively searching for new clients and get business they might just offer you lower rates and added benefits. When two or more banks offer the same, choose the bank that has lower penalty rates. Following these factor makes sure that you have personal loan that has a lower interest rate and comparatively lower penalty rate.
Article refer: http://personal-loans.sg/how-to-find-the-best-low-interest-personal-loan/
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