Personal Loan Fees And Charges You Should Know About
Before you take the necessary steps in applying for a personal loan be sure to ask yourself first if you really need a personal loan.
Do you need it to pay for something important? Can it wait or is the need too immediate it can’t wait for your next paycheck?
Finally, you also need to be prepared for all the fees and charges you should look out for when applying for a personal loan.
What are the fees and charges that come with taking up a personal loan?
Here are the fees and charges involved when applying for a personal loan in the Philippines:
While some banks have no cash out policies they will still deduct a small amount from your loan to cover for the processing.
Some banks will charge you P1500 to P2,500 for the loan processing alone.
Early Payment Fee
You can pay off your loan balance in full anytime, some lenders will require you to pay your outstanding principal balance plus a standard fee but this is a case to case basis.
Some banks charge a flat fee of P3,000, or a percentage of the outstanding balance, while others don’t require an early payment fee at all.
The main advantage of allowing you to pay off your balance earlier than your maturity date is that you can save on interest expenses.
Late Payment Penalty
Late monthly instalment payments are usually charged at 5% per month, but the rate varies depending on the lender or the bank.
In order to avoid late payment charges, be sure to pay your monthly installment before your due date.
Documentary Stamp Tax
A DST is a tax applied on loan agreements, contracts, legal documents and other law binding documents.
In the Philippines loans above two-hundred and fifty thousand pesos are charged with documentary stamps tax of one peso for every two hundred peso of the approved loan amount.
Read More: Should You Get A Personal Loan?
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