If you’re considering getting financial help, here’s what you should know.
17 July 2017| Last updated on 17 July 2017
Taking a personal loan is a big commitment. As an expat, you have to be certain that you’ll be able to pay it off. Considering that non-payment debts has serious consequences in the Kingdom, finding the right loan is extremely important.
There are several things to take into consideration when deciding on which loan is best for you. One of the main ones is the repayment period. Usually, the longer you take, the more interest there will be.
When it comes to fees, you should look into what upfront fees the bank charges as well as penalties for missed payments. Another thing to look into is early settlement fees because it can be a really high amount. For instance, some banks ask for 35 per cent of the remaining profit in the case that you choose to pay off your loan early and other banks can require you to pay 100 per cent of the our outstanding profit.
Loans between SR 50,000 and 10,000
For lower loan amounts, look into ones that have low or no early settlement fees. Some banks might not want to give away small amounts as it lowers their profit from interest, so they spread the payments over a longer period, typically 48 to 60 months.
You also have a possibility of getting a credit card with a high borrowing limit. While the interest rate will likely be higher, it’ll allow you to pay off the loan in a couple of months.
If there’s a specific reason behind your need for a loan, you might be able to take out a designed loan, such as for education or a car.
Loans between SR 100,000 and 500,000
For higher loan amounts, look into ones with shorter tenures and low interest rates. Generally, loans that have a fixed lending periods work best for expats who know what will be going in and out of their bank accounts on a monthly basis.
Don’t forget to take upfront fees into account. Those fees are usually between SR 1,500 and 2,000 but can differ depending on your bank.
Loans of more than SR 500,000
Considering this a significant amount of money, finding the most suitable bank is crucial.
The early settlement fee should be one of your main concerns when it comes to this type of big loan. Since the amount is so high, the penalties will also be very high. The last thing you want is to be paying the bank profit for the remaining number of years on your loan, even if you’re able to pay it off quickly.