Repaying a huge loan can be a difficult thing to do. You have to face rapidly scaling interest rates and other associated fees. But don’t worry – missing one payment is not yet the end of the world!
Do you want to pay off a large loan and get your life back? Here are some strategies:
Find Another Income Stream
Perhaps the most useful and easiest strategy that you can apply to pay off your loan is to find a second (or third) income stream.
If you think that your job couldn’t cover future loan payments, then you may need to start a side hustle. Before doing this, you should take stock of your skills and proficiencies.
Are you good with writing?
Then you can take freelance writing gigs.
Do you have a knack for selling things?
Then you can partner up with small businesses and become a sales agent on commission.
The possibilities are near-endless when it comes to finding a new income source!
Pay Small Amounts Per Week
Typically, lenders will allow you to pay any amounts before your repayment schedules. This will help you finish off the loan before its maturity date. But lending is a business, and not all lenders will adhere to this policy. Paying off the principal will reduce the lender’s profits over time. Still, if the lender allows you to pay in advance, take this as a golden opportunity.
Pawn Some Items
Running out of spare cash is not a pleasant thing, but it’s the hang-up of everyone from time to time. One tried and tested strategy is to look for some old items that you can pawn.
These items range from gadgets, old equipment, collectibles, jewelry, and other stuff that has innate value. Not all pawnshops will give you a satisfying deal, though. After repaying your loan, you can now work hard to get your items back.
If your huge loan is really disrupting your finances, then you should consider a loan restructuring process. Through this process, your debt can be turned into a manageable loan with a new repayment agreement. You just need to bear in mind that not all top licensed moneylenders in Singapore agree to a loan restructuring process, and this will take a longer amount of time. Also, loan restructuring agents have fees that you must pay over time.
Saddle Up With a Smaller Loan
Some people will advise you to take up a smaller loan and use it to pay your huge loan. This is a sound strategy, but it requires the utmost care.
If you are not careful, you might end up sinking in deeper debts and inconvenience. In this case, personal loans and payday loans are great options because of their variable interest rates. Keep a reliable repayment schedule before applying for a personal loan or payday loan (see
By doing so, you won’t have problems with uncontrollable interest rates someday.
While the mentioned strategies are essential for paying off your huge loan, you shouldn’t feel complacent. Always remember that a loan must always have a purpose – instead of it being stagnant. So, before applying for your next loan, make sure that you have ways of repaying it!