HSBC Debt Consolidation Plan Review

HSBC Debt Consolidation Plan Review

The lowest guaranteed debt consolidation loan rates available to borrowers in Singapore.

Good for

  • Borrowers in Singapore that require a large debt consolidation loan to manage their personal debt

Bad for

  • Borrowers that are able to qualify for the lowest advertised interest rates from other lenders

Editor's Rating

4.5/5.0

Singaporean's with high levels of personal debt may find it helpful to use a debt consolidation loan to manage their debt. HSBC offers one of the best debt consolidation plans (DCP) in Singapore. The plan offers the longest loan duration (up to 10 years) and competitive rates (from 3.8% p.a.), making it the most affordable option for borrowers seeking a long-term debt consolidation loan.

Summary of HSBC's Debt Consolidation Loan
Lowest Guaranteed Interest Rates: from 3.8% p.a. (7% EIR)
Loan tenure: 1 to 10 years
Promotion: Processing fee waived for online applications

Table of Contents

What Makes HSBC's Debt Consolidation Plans Stand Out to Borrowers

HSBC charges competitive interest rates for its debt consolidation loans and offers tenures up to 10 years. This makes it one of the best lenders in Singapore for your large or long-term debt consolidation needs. Additionally, it is currently waiving its application fee for online applicants, which is normally S$88 or 1% of the loan amount. In contrast, its competitors often charge S$100-S$200.

HSBC Debt Consolidation Plan Details
Loan Duration (Years)1-10
Annualised Flat Ratefrom 3.8% p.a. (up to 5.2% p.a.)
FeeCurrently Waived (1% or S$88)
Annualised Effective Rate7% (up to 9% p.a.)

While a few lenders advertise lower rates than HSBC, they tend use vague language (e.g. "as low as") that indicates that borrowers may actually be offered substantially higher rates. For this reason, HSBC stands out as one of a few lenders that provides details regarding its interest rates.

Who Can Apply: Eligibility Criteria

Consider this if you prefer a long-term plan with the competitive interest rates and no processing fees

Balance to Income Ratio More than 12x monthly income
Early Repayment Fee 5% of redemption amount
Late Payment Fee S$75
Processing Fee S$88 or 1%, waived for online applications

Singaporean citizens and permanent residents with incomes of between S$30,000 and S$120,000 are eligible for HSBC's debt consolidation loan. Applicants must also have a balance to income (BTI) ratio of at least 12 times their monthly income. Additionally, individuals participating in the RAS scheme are eligible for HSBC's debt consolidation plan.

Other Charges and Fees

In addition to the 1% processing fee, which is waived for online applicants, HSBC charges an early settlement fee of 5% of the redemption amount. It also charges a late fee of S$75 and charges an overdue interest fee of 2.5% plus the prevailing interest on the overdue amount. The S$75 late fee is the lowest charged by DCP lenders. That being said, we strongly advise borrowers to make timely repayments in order to minimise the total cost of their loans.

FeeAmount
Processing Fee1% of approved loan amount (min. S$88), waived for online applications
Early Settlement Fee5% of redemption amount
Late FeeS$75
Overdue Interest Fee2.5% plus prevailing interest on overdue amount

How to Apply: Application Process

Applicants can apply online by filling out and submitting an application form. The form requires personal, employment, salary and financial information. Additionally, prospective borrowers must provide proof of identification, income, current debt and credit history. Applicants may also call HSBC or visit HSBC branches for assistance with the application.

For proof of income documents, salaried individuals must provide their most recent 3 months of computerised payslips, latest notice of assessment and latest month's computerised payslip or latest 6 months' CPF statements with latest month's computerised payslip/notice of assessment. Self-employed and commission-based employees must provide most recent 2 years' Notice of Assessment.

  • Photocopy NRIC (front & back)
  • Income documentation
  • Credit Bureau Report
  • Latest statements of applicant's existing unsecured credit facilities
William Hofmann

William is a Product Manager at ValueChampion Singapore, focusing on banking and SMEs. He previously was an Economic Consultant at Industrial Economics Inc.

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