Beware of cheap loans in the market or through the recommendation of friends or associates. These may not be necessarily good deals if they are from unlicensed lenders. There are usually hidden catches which can cause much frustration and anxiety to the borrowers. Cheap loans may offer low interest rates and high loan quantum quickly.

Many borrowers are taken in by the low interest rates although other conditions may be very stringent. Cheap loans may come with a very short repayment period like a week which may be very pressing on borrowers to repay the loan in full unless the borrower is sure of securing more finances for repayment. Otherwise, the interest rates change from low to very high. It could be compounded interest on a daily rest rather than the attractive term repayment at the offset of the loan deal. Once the loan is not settled as per contract, the high charges set in. do you agree