Personal Loan in the Philippines: 10 Myths You Should Forget About

Personal loan in the Philippines is a common thing you have probably heard about thousands of times, but what concerning popular myths of getting a loan in the Philippines people spread without ground reasons and consider them reasonable. So, what is really true and what is false about all that stuff? There is usually someone who thinks differently, and it is absolutely natural, but what if he or she does not know exactly and just says what others say or has a wrong misapprehension. The same is here. Well, let’s check them and dispel some popular myths on getting a personal loan in the Philippines

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Personal Loan in the Philippines

The diversity of online and offline information on personal loans everywhere can help us to solve our temporary financial troubles or even make us confused and puzzled. To avoid the last case, it is usually important to check and understand the whole thing personally. 

Following all these personal loan myths people can miss a lot of important opportunities, as for example, for starting a new business or financing your post-qualifying education. 

On its own terms, borrowing the necessary sum of money from credible financial institutions is not a crime at all. It is just important to be responsible for all your actions to receive real assistance and benefit for your personal needs. 

Learning for yourself concerning personal loans in the Philippines is a solid moving ahead for making the right step and choose what is good and appropriate for you personally in this or that circumstances. 

We have selected the common misinterpretations about personal loans that every Filipino should forget about. 

Personal Loans and Their High-Interest Rates

The following personal loan myth comes from the imagination and some background of those borrowers who are entrapped in considerably high interest of different quick cash loans. And what is bad, that is they heavily believe that these ones are the only kinds of loans that exist for them. Nevertheless, it is necessary to know that not all kinds of loans in the Philippines offer only high-interest rates. The traditional government agencies and banks have very low-interest rates, as for instance, something like 10% per year. In order, to discover personal loans with appropriate low-interest rates, it is important to do additional research and make a comparison of all available rates online. Such an approach will definitely help everyone to choose what is really appropriate and good at the moment. In this way, you will avoid misunderstandings and get more chances to find the best personal loan with ideal interest rates in the future.  

Personal Loan Application is a Challenging process

ersonal Loan Application

There is one very popular false idea when many Filipinos think that submitting a personal loan application is something complicated and confusing. According to their opinion, it takes too much time and requires considerable paperwork and endeavours. 

Contrarily, various lenders online and private organizations need very short information about the person who applies, that means minimal docs. Traditionally, lenders simply ask for a valid ID and the data concerning regular income.

It goes without saying, that banks and agencies of the governmental level are more fastidious than other moneylenders when it goes about requirements, the docs they need could be active, valid, real and something like documents for bank taken from your hirer, as for instance the proof of employment. 
The best way to get a personal loan in the Philippines without any complications is to apply online. You just submit all the necessary information as well as obligatory soft copies of the background materials through the Internet. 

It takes too much time to approve Personal Loan in the Philippines 

Due to considerable technology breakthrough, we have many possibilities today, that is why it is a major reason why people should forget about the following myth. The online system works really very quickly, giving the clients convenient conditions to choose and act the way they want. All the financial systems (and not only) are fully automated that makes the whole process of applying and getting the answer on loan and then money faster than it was some ten or more years ago. Quick loan approval of the system is a very attractive thing for many borrowers in the Philippines and many other countries around the world.

If we go back a few years, we will recall how long the common loan processing was – something about 5-7 business days. Currently, in the rat race social surrounding, we care about our time and waiting too long for loan approval is not a way out at all. It’s a problem. That is why a lot of lenders care about every client and make all the processings within several minutes (only online money lending) or the whole day if to apply to some bank. This advancing makes personal loans in the Philippines more suitable and acceptable for catering pressing financial needs.

Employees Have More Chances to Apply and Get a Personal Loan

What to do if you are a freelancer or just a self-employed individual? Many people think it is the main handicap for getting a personal loan in the Philippines, but is it true? Of course, it is the next widespread misconception among a great number of people. 

They think that individuals with stable official salaries have the best chances of getting approved for a personal loan in comparison with self-employed ones. And it is simply because they can present the documents on their regular income. For online loans, it is not really important, as these financial establishments provide their service for everyone who needs money at the moment, no matter who you are – a freelancer or an entrepreneur. You can really stand a chance when it is going to a personal loan in the Philippines

It has been known that self-employed people in the Philippines can take money for their own business purposes or personal ones without any problems. The only thing is that they have to submit more documents on their financial state in comparison with just employed people there. In such a way, they will prove their capability to pay back a personal loan in the Philippines easy. 

To be eligible for a personal loan – check if you have an excellent Credit Score

Credit Score Philippines for a personal loan

As you can see there are too many personal loan myths in the Philippines and this one is not an exception. To some extent, it has the right to exist but it is better to iron out this myth as quick as possible. It’s not a secret that the credit score of a borrower sometimes may influence negatively his or her chances of taking a loan with a low-interest rate. Still, people with non-perfect credit history can get approved easily. 

Definite kinds of lenders, as for example those that offer and give loans online as well as quick cash loans refer to borrowers without any credit history and also those who have some not ideal credit score. The system just approves the online application without any credit checking or inquiry. But for borrowers, it is very important to provide the document that proves his identity and, of course, the information concerning a stable income.   

If it happens, that you have a bad credit history and want to get a personal loan online in the Philippines, you may face a tradeoff, as for example, high-interest rates and time-limited periods for paying back. 

One More Deal Breaker to Qualify for a Loan is Your Bank Account 

Let’s open the curtains and say everyone in the Philippines, that absence of a bank account is not a problem at all if you are going to apply for a personal loan. Most of the online lenders who offer payday loans, personal loans, or very popular fast cash loans give approval to their borrowers’ applications without paying attention to the availability of a bank account.  

In the case of applying to a bank, it is strongly recommended to have one. As a rule, lenders release credit facilities through the savings account of the person who applies. Currently, there is no difficulty to open a bank account.

Many Fees for borrowers

Fees for personal loans in the Philippines are very easy to avoid. This category traditionally includes late payments, amendment fees, bad check and so on. Here is only one situation when it is necessary to pay many fees – the one does not manage his or her loan repayments properly. What does it mean? For example, someone decided to pay back very late or has inconsiderable funds on his checking account, the case with defaulting on a loan. 

Scams in Online Lending

There are a lot of people who have definitely heard about the scams in the are of online loans. What are the cases when moneylenders simply disappear for no good reason exactly after they made their borrowers pay an initial sum of money? In these recent times, unfortunately, we can face the following situations with some unfair lenders. That is why we can find even a great number of complaints against several moneylenders on the Internet in the Philippines that discredit and give problems delinquent borrowers. 

At the same time, it is necessary to know who is who, and despite the fact, there still exist some scams in online lending, it is important to know that there are also a great number of legitimate online lenders in the Philippines who cares about people and operate absolutely ethically and clearly in this country. 

For the sake of a safe getting personal loan in the Philippines online, everyone should know the best and legit lenders online. Look through the list of all the registered financial or lending organizations on the Securities and Exchange Commission’s site.

Personal Loans will make Your Life the Whole Debt

One of the most prevailing myths about personal loans that makes people worried is about drawing them in debt, but this one should not be believed. Personal loan in the Philippines is not something special for people who need money temporarily, and it can not lead to any huge debt at all. On condition that you apply to a reliable lending company online that offers its clients the best possible terms and rates, you will definitely receive the necessary sum of money very quickly and without considerable future debts. It is just impossible and is a real myth. 

Before applying be usually confident that you will be able to cover the specified sum of money without delays to be on the safe side and feel comfortable. 

It’s Impossible to Negotiate Personal Loan Terms

Life misfortunes cause sometimes financial troubles which we face recently very often. The following situations as loss of work or a medical connected with the family or close people can negatively influence the way you will pay back the money you lend, and it is not important how smooth you cope with it. It is essential to avoid any loan defaults.

You should care about it and try to prevent gathering a great debt. Simply contact the provider of the personal loan you got and interpret the circumstances you have stumbled upon. It is not 100 % that he or she will listen to you and give you the way, but still, you can try, as most providers are ready to listen and negotiate to help their clients. For example, you may ask to prolong your loan term or make the interest rate reduced. In such a way you will be more confident in what you do and it will help you to address this matter in the nearest future.

Summary

More about personal loan in the Philippines:

Pros

  • Quick applying and approval processes
  • No need a lot of documents
  • You can get money online

Cons

  • A lot of Scams
  • Sometimes too high-interest rates
  • Not transparent terms
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