Living With No Debt and No Credit Score
It is possible to cope without debts too. However, debts can also be helpful in life and some people consider loans as a very useful thing in life. There are those who simply dislike the thought of borrowing money. Life with no debts can be easy too.
In order to make your life much easier, you can consult legal lenders such as licensed moneylenders and banks in Singapore.
How To Spend Without Credit Cards
Most people prefer paying all their bills such as gym membership, mobile bill, and other utilities. You may choose the online payment option for your bills and your bank can send electronic transfers. You could alternatively settle the same bills using a debit card as well.
Debit card needed
The best of option is a debit card that works anywhere even when an online form requires that you fill a card number.
It is easy to pay using cash and even debit card for meals, groceries, and errands. Although cash makes management of your budget easy, it can at the same time rather risky to have lots of cash on you. A debit card offers you the convenience and is linked to your checking account. But, here you will only spend what is in your bank account.
For those who do not have checking accounts, then the prepaid debit card is an option to the regular debit cards. This type of card is first loaded with funds before using it. The prepaid card can be used to pay all your bills in one swipe. Once the card balance is used up, the card will stop working.
Sometimes, debit cards can really be problematic when you use them without knowing the account balance. This often comes up mostly when the card is used in renting a car or some hotel. The moneylender will lock up funds in your checking account. This will resolve after few days however it will cause you trouble even when you have sufficient funds in your account. However, this can be a problem when the bank does not allow you to use it. It is best you have some extra money on you and regularly check your balance as well.
Credit vs. Debit card
Prepaid and debit cards have more risks than credit cards. Also when your card gets stolen, any charges made on them will directly be from your bank account. Often your bank will notify you of any errors and frauds from card transactions. However, it is best that you notify your bank immediately to help reduce the risk.
However, using credit cards has a downside as well. Since the world is moving towards being a cashless society, retailers, and businesses are geared up to adopting the cashless payment plan as well. Soon, most places will not be accepting cash any longer.
Spending Less and Saving More
When you opt to live a life without incurring any debt then you have to pay for everything you buy using cash money. You can also make use of a debit card instead of paper cash for purchases as well. This, however, can be very challenging should you decide to make big purchases.
You will require lots of money when you want to purchase a car without the funding. It will be even harder when you are buying a home. When you do not want to borrow, you will have to wait much longer before you can buy large items or property. For higher purchases, you will require major savings too.
In many instances, many people choose to buy fewer things and then wait longer to increase savings for huge purchases.
Purchasing a Home
In Singapore, purchasing a home will cost you thousands of dollars thus you have to save lots of money for this. Most buyers have to save for a long time before they can make a purchase. Even when you are considering getting a mortgage you have to do more than other borrowers because of the lack of credit.
Your moneylender will also consider your income that can go towards paying the mortgage. This becomes very crucial when you do not hold the traditional credit.
Lenders need borrowers who are more stable. A borrower with a good employment history is what most lenders want. This will guarantee that you earn better in future as well. They will also consider the industry you are in as well.
You need to have a healthy credit score for you to get approval for a personal loan. In Singapore, some moneylenders are quite selective and they are not ready to deal outside these. This will at times limit the type of personal loans accessible.
In Singapore, licensed moneylenders will mostly ask that you submit all the documents of insurance, rent payments and also other utilities. Before you consider applying for a personal loan, make an effort to pay all your monthly bills regularly.
It is also a good that you keep a substantial amount in the bank. This will work for you. When you are without debt then you are nearly there. When you are financially secure it means you have a higher likelihood of the getting an approval.
Time to close
When a borrower does not have any credit score it can be very tough and at times will take longer to access a personal loan. The money will require all of the necessary detail from you then settle everything. Therefore, when you choose this option, make certain that you have everything ready, then you can make an application right away.
Should You Avoid Credit Entirely
It does not mean that you avoid credit completely. This is because it does have some useful benefits for anyone who needs it. It is really good for a borrower or has a solid credit record. This is because it will help you in nearly all places. Ultimately, what is crucial is your spending since this is what will decide everything