Is HSBC Personal Line of Credit Attractive?

Do you think you need an HSBC Personal Line of Credit? Here’s how you can identify if it is helpful for your finances.

The Personal Line of Credit is much like a credit card. It has a credit limit which you choose whether to use all or not. And like a credit card, it puts you at a high risk of overusing it if you can’t control your spending.

Yet, unlike some credit cards, people without a credit history can apply easily. But with HSBC Personal Line of Credit, it dramatically depends on the credit score. Moreover, since this credit line is a preapproved unsecured loan, the bank will naturally want to lessen the risk of loss. Thus, they need for reviewing your credit history.

Once approved, you can access funds whenever you need them. Also, use it for almost everything you want. For example, you can pay services and bills, go shopping and have some minor repairs at home. But, then, you have to pay the interest charged on your used amount.

HSBC Personal Line of Credit Eligibility

To have a Personal Line of Credit from HSBC, you need to be at least 21 to 65 years old. Of course, there must be a minimum annual income. Employed Singapore Citizens and Permanent Residents must earn at least $30,000 a year. Self-employed, commission-based, and foreigners must have a yearly gross of $40,000. In addition, you must be able to present the needed documents. For example, a photocopy of your NRIC/passport and payslips is a must-have to process your request.

The HSBC Personal Line of Credit is unsecured. It means there is no need for any collateral. So the bank will base your approval and credit limit on your credit score and salary. Once approved, you will get cheque books and a debit card. It is a way for you to access the funds. These are free of charge.

In addition, you can request a specific credit limit. But this is subject to the bank’s approval. For example, the bank usually offers a credit limit of 2-months’ worth of salary but not exceeding $100,000.

HSBC Personal Credit Line Interest Rates and Fees

Personal Credit Line charges 18.5% per annum. But the interest rate is charged daily based on the outstanding balance. The minimum charge (regardless if you use the credit) is $10. If you are an HSBC Premier customer, your interest charge will decrease to 12% per annum. HSBC Advance and Revolution customers have a preferential interest rate of 16.5% a year.

Let’s say you had unexpected expenses. You spent more than you planned. So you issued a cheque charged on your credit line. You have to pay your balance on its due date. It is typically 22 days after the statement date. If you can settle the balance, you have to settle at least 3% of the outstanding balance or $15. However, if you fail to pay even the minimum amount, you will be charged a late payment fee of $75.

Yes, you can at least pay the minimum amount. But remember that the unpaid balance is still charged with the interest rate daily. Also, you are subject to annual fees whether you use the credit line or not.

HSBC Personal Credit  Line Balance Transfer

You can only make one application per credit line. Expect that you will be charged a processing fee of $88. You can transfer at least $1,000 up to 90% of the credit limit. It is subject to the bank’s approval based on your current outstanding balance in your credit line.

The Downside of HSBC Personal Line of Credit

Since you have the funds any time you want to access it, you need to keep on paying the annual fee to keep it open. On the other hand, remember that the amount used from the credit line stands as a loan. So if you keep on using the funds, especially in small intervals, your credit score will receive a serious blow.

The funds will always be available to you 24 hours a day. Therefore, it would be best to weigh your needs and wants regarding spending. Spend what you can afford to pay.

If you are sure about the amount of money you actually need, it is better to get a personal loan. You just have to pay the interest rate as it has no annual fees. You can easily get it from Cash Mart today if you need quick cash loans.