What is instalment?
Returning back the money borrowed from a loan providers, such as a bank or financial institution, is termed instalment or repayment. Repayment of loans often cuts across instalment payments which include portions of the principal sum and the interest accrued. Borrowers who fail to meet up with their instalment can be forced to admit being bankrupt, which will negatively affect their credit ratings.
It is the loan provider's belief that upon requesting a loan, the borrower must have a means of servicing them. Interests are the charges paid for loans granted and they are often illustrated as the APR or the Annual Percentage Rate. Likewise, the time difference between when the loans are dispensed and when full payment is made determines how much is charged as interest rate.
Repayment difficulties and consequences
Declaring bankruptcy might feel like an "easy way out" when loans cannot be repaid, but it should always be viewed as a last resort. As a borrower, you are advised to seek out other flexible options, as declaring bankruptcy will limit your likelihood of getting future loans. Earning new income, renewing the terms of a loan, and bargaining with banks, are means with which bankruptcy can be mitigated. Also, setting up reasonable budgets with the aid of professionals and being committed to keeping them is another option.
Strategies designed for repayment of loans often differ with the type of loan and the firm lending it. Some loan offers layout options to take if a borrower cannot meet up with repayment. Reach out to the bank in situations where drawbacks, like health or employment issues, or any other predicament you might be facing, will deter you from fully servicing the loan.
Loan repayment cycle
Loan repayment can be made in instalments, either on a monthly, quarterly or yearly basis. Any day of the month, as agreed with your bank, can be the due date for your repayment.
Fortnight loan repayment options are offered by some lending institutions, and a lot of banks permit early loan payments too. The borrower can achieve this by offsetting any pending debts in a lump sum, or via routine instalments with added payments going with them. By this means, you repay your agreed monthly instalments in a way in which you will be able to pay off your loan faster. A fee is can be charged for this by some institutions.
Loan instalment methods in Singapore
Easy and assured payment of loans can be done via any of the below options:
Standing instructions: At a monthly fixed rate, this option requires you making automatic payments for your loan liability through your loan account. Fees are often charged for this service.
IBG (Inter-Bank GIRO): Easily accessible using an ATM or via internet banking, this service is an electronic transfer of payments from one bank account to another, and depending on the institution, there are often limits fixed on the maximum amount transferable.
Internet-based payments: This involves making repayment through online facilities and the payment portals of the lending institutions.
Apply for a loan with Lendela and compare instalment plans from various banks and financial institutions. It is fast, simple and obligation-free.