Most Filipinos sometimes do not have enough savings in their bank account when needed in an emergency. We’re familiarizing ourselves with “utang” or loans in the event of a budget cut, but regular personal loans from private lenders or banks sometimes take a long time before they’re approved, it can take hours, days, and if you’re unlucky, it can take months . Then what is the best option if you ever needed money in an emergency? What if you need to rebuild and repair your home or car because of a flood or disaster? Then familiarize yourself with the power of an emergency loan.
What is an emergency loan?
A emergency loan (also known as an advance) is a short-term, unsecured personal loan that you can borrow immediately in an emergency. In the Philippines, individuals can mostly apply for emergency financing from private lenders, government agencies, and employers.
In contrast to a normal personal mortgage, emergency loans often have shorter payment options and higher interest rates and fees. This is because the bank or other credit service providers know you may not have many options other than agreeing to the deal.
SSS Emergency Loan
One of the most famous emergency loans in the Philippines is offered by the SSS or Social Security System and is called the SSS Calamity Assistance Program (CLAP). The SSS Disaster Relief Program is aimed at any Filipino member affected by disaster and in need of financial assistance.
Due to the further increasing number of Covid-19 cases, the government in the Philippines has declared a state of emergency and has placed it under strict quarantine. It has caused businesses to close temporarily and many people to lose their jobs. Almost every family faces financial challenges in every home. Luckily, the social security system is offering disaster relief to Filipino members affected by the pandemic to help them get back on their feet as the pandemic is impacting their lives tremendously.
SSS Disaster Loan
The SSS Calamity Assistance Program (CLAP) offers a loan amount of up to PHP 20,000 depending on your average monthly salary balance and has an average interest rate of 6% (previously 10%). As with any mortgage, you must pay each payday monthly. SSS Calamity Assistance offers a payment period of 27 months. However, you only pay four months after receiving the approval date.
Filipino members can now apply for emergency SSS assistance online through the SSS websites or through their MySSS account through the SSS mobile app.
How to get an emergency loan
There are many ways to get an emergency loan, either from the bank, pawn shop, private credit agency and you could even get it from a friend. When you know you don’t have enough savings in your bank account or know it wouldn’t be enough in an emergency, being ready is never a waste of time.
Always check your credit history. Your qualifications to get one emergency loan depend on your credit rating, especially if you are thinking of getting an advance from banks. Also, good credit could connect you to a better interest rate and payment terms, in short, a great deal!
Look for better alternatives. We understand that applying for an emergency loan means you need the money right away. Even so, we strongly recommend looking into various options that can save you money. Always plan and check the websites of various online loan companies, pawn shops, banks and government agencies online to ensure you are getting the best deal in your area.
Bad credit emergency loan
Being hit by an unexpected cash need can be overwhelming, especially when you don’t have enough savings in your bank account. Whenever this incident happens, we often think about getting emergency help. But what if we have bad credit on our credit reports? Well, you don’t have to worry. You can still qualify for a loan, but with limited options. The options available often offer higher interest rates of at least 30% or even more, depending on how poor your credit rating is.
In addition to borrowing from a bank, you can also borrow from pawn shops, private credit agencies, government programs, and even your family members. Always offer replacement loan services, especially for borrowers with bad credit. You’ll never know when or where you’ll need emergency cash or an emergency medical loan.
Emergency Loan Application Letter
Some traditional bank lenders or lending companies require one emergency loan Letter of requirement before the company approves your application. The letter should include the applicant’s name and address along with other personal information, the amount, and the reason for the emergency advance. Be sure to include your references in the letter or how you intend to pay off your debt and why you should be funded. This way, the bank has more reasons to quickly accept your application. There are tons of guides online on how to write a proper letter request that might help you.
Don’t forget to include the rest of the requirements in your letter in order for your application to be approved.
Online Emergency Loan
Due to the pandemic, it is sometimes not possible to go outside and apply for an advance. Luckily for us, we can now recruit various companies and agencies that offer emergency advances online with UpFinance using our phone, laptop or computer!
UpFinance made financing and borrowing in the Philippines more convenient and faster. Visit the UpFinance official website and select the type of loan you want. You will then immediately see the top companies offering the financing you need.
They have a large number of trusted partners to ensure the safety of their customers. Some of their partners are well-known banks, co-ops, investment companies and pawnshops such as BDO, BPI, RCBC, Home Credit, Ayala Coop, Palawan and many more!
Author Jejomar Baccay from Upfinance