PauloAbad
One of the things OFWs can do in case they’re short on money is get a loan. But just because you can borrow cash doesn’t mean you should. In fact, there are a lot of things you need to consider before you apply for a personal loan or pledge your vehicle or property as collateral. Below is a list of some of these factors.
Type of Loan
One of the first things you need to learn before borrowing cash from a financial institution is that they come in many types, including personal, business, student, and mortgages. OFW loans are specifically created to cater to Pinoy working outside the country, so if you’re currently employed in a land-based or sea-based job abroad, then this is the loan you need to apply for.
Length of Loan
Cash loans also come in various payment lengths. Some require you to settle your debt in as long as five years, while other firms mandate you return what you borrowed within three months. Thus, it’s important to factor your ability to repay what you loaned. Doing so will not only help you get the best deal available, but it will also enable you to settle your debts at the soonest possible time.
Interest Rates
Interest rates come into play as well when you’re an OFW seeking financial assistance. These rates will impact the total amount of money that must be paid back, and it will help you find the best bank or financial institution to borrow cash from. So as much as possible, try finding a loan program that has a low interest rate. And make sure the program doesn’t have any hidden fees; otherwise you’ll be better off with high-rate schemes.
Credit Score
OFW or not, money lenders will look closely at your credit score before approving (or rejecting) your application. Needless to say that the higher your score, the more financially trustworthy you’ll seem to banks and lending firms. So if you want to borrow money and you find your credit score dangling on the lower end, best find ways to boost it first.
Financial Situation
And then there’s your present financial status. Are you currently in debt? How much are you making on a monthly basis? And how much do you have left after tax obligations and remittances? You need to be able to answer these questions first before applying for a cash loan. Make no mistake, banks and financial institutions will ask them.
Think of These Factors
Understanding the factors mentioned above will help increase your chances of approval when applying for an OFW loan. Therefore, you would do well to think of them before going to the nearest bank or lending firm.