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Can A Credit Card Affect your Finances in Singapore?

Are you still wondering if it is a good idea to have more than three credit cards if you are residing in Singapore? Well, the answer is a big no. Regardless of whether you are a good payer or not, credit cards may have a big impact in your life. It may affect your finances for sure. Just imagine your situation being threatened. This will transpire if you do not have the commitment to pay. That is for sure.

The Way Credit Cards Impact Personal Economy

If you are still not enlightened about this claim, these are some of the ways in which multiple credit cards may impact your personal economy:

May give you a hard time seeking mortgage and housing loan approval

To own a house in Singapore can be a challenge most especially for those who are non-native residents. Most of the time, there are ways in which you can obtain a home here. First, you are free to know if you will be qualified for an HBD loan. This is known to be more affordable as compared to a private home loan simply because it is offered by the government.

Most are not accepted by the HBD loan though because of their salary. This may transpire even if your salary is way higher than the criteria already. When this is the case, you will definitely be forced to secure your private mortgage. This may be won from various banks out there. Once you have credit card issues about repayments, you may face an issue here too. This is true because most banks will check your financial standing.

May consume most of your pay.

Most Singapore credit cards are considered debt. This is the truth that you must accept, no matter how cringe-worthy that sounds like. To simply put this, you have the obligation to pay creditors so that they do not go running after you eventually. If you are known to be a regular employee in Singapore, the only way you can settle this is to use your salary. That is not rocket Science for sure.

Please be reminded though that Singapore has always been an expensive country. To maintain a home and a vehicle in the said country can be of high maintenance. This only goes to show that if you own active credit cards, you will be forced to take on another job so that you can only reduce most of your expenses. This is the only way you can go on for the repayment.

May take up a huge amount of your living expenses.

There are instances when credit companies would claim to be interest-free. However, do not be so naïve to believe that the situation will be the same for the rest of your life. Tell you what – that is not going to happen. It will only be favorable for a number of months. Afterwards, an interest rate will kick in later on. In Singapore, the prevailing interest rate is around 18 to 24 percent. This may get higher so you have to be careful.

About John C. Welborn

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