Top Licensed Money Lenders in Singapore
A Smart Guide to Comparing Licensed Money Lenders
When you find yourself in urgent need of extra money, it's natural to panic. The deadline for rent can be fast approaching, your family may repeatedly be calling for help in an emergency, or there's an instalment plan you really need to pay for. In any scenario, your next pay check may not cut it in time. Most of the time, the best option is to turn to trusted and licensed Singapore moneylenders.
Most moneylending companies offer a variety of cash loan packages to cater to citizens, permanent residents, long-term foreign residents, and domestic helpers. However, more people buying into the benefits of moneylending means more loan packages and moneylenders to choose from. It's easy to get overwhelmed by all the information, even if you have a full directory. How then should you decide?
This article offers the must-knows when it comes to comparing moneylenders listed online or referred to you by friends.
Search for quality reviews on moneylenders.
It's easy to promise a lot of great things in one convenient, cheap, and accessible loan package. However, you may have heard any number of true horror stories when it comes to moneylending. These adverse experiences can range anywhere from hidden fees written in the fine print, lousy customer service relations from the company, to unfair rates and terms.
Unfortunately, many people continue to get into this sort of trouble because of the power of flashy ads and well-spoken moneylending representatives. Before you choose the best-sounding loan package just because the website looks nice, you should invest in checking out quality reviews.
Reviews and testimonials give you more solid insights into the actual performance of a moneylending company. Are they fair? Are the terms clear? You can see the answers for yourselves through quality reviews.
A moneylending directory is an invaluable tool in comparing moneylenders. Referring to the unbiased reviews offered by a moneylending directory can help you weed out fact from fiction with more confidence.
Know what benefits you want in a loan package.
Knowing which benefits or advantages you want in a loan can help you narrow down your options. For example, are you concerned about the scheduling of the loan payment and fees? Do you need a fast loan or a huge one? What loan requirements are you concerned about?
- Address medical and financial emergencies. Getting the money you need to pay for urgent services is one of the most significant benefits in any loan package. If you need a considerable sum of money as soon as possible, you should start comparing only the loan packages which can give you the amount you need. There's little sense in trying to borrow less money than you need to pay for an emergency situation.
- Loan for the short term or long term. One of the most commonly cited reasons for getting a loan is to tide you over until the next month's pay check. The relatively quick process of getting a loan from moneylenders is a definite advantage over going to banks.
- If you need a loan to merely meet your daily needs, such as this week's food or the creeping electricity bill, then you should focus your comparisons on short-term loans. If you feel like you need more than the next pay check to settle your bills and repay the loan, then narrow your search to long-term goals.
- Improve your credit score and invest in your future. If you need a loan to boost your credit score, then you need to look for a moneylender that has the perfect package for you. You may not need to deal with high fees or interest rates if you find just the best and flexible loan to pay off your existing debts. Likewise, if you need a loan to invest in your friend's company, or to grow your own skills and ventures, focus on loans which have a feasible repayment plan.
Once you know what benefits and advantages you are looking for, you can skip over moneylending and loan packages which don't suit your needs.
Look for the type of loan that would suit you.
Another way to compare moneylenders is to approach the directory by type of loan. There are some types of loans which can satisfy you depending on your purpose and on your nationality. The variety of packages offered by Singapore moneylenders can be intimidating at the start, but you'll be fine as long as you remember why you are applying for a loan.
- Payday loans. Bills and utilities can quickly accumulate, and there are many instances when your current take-home salary is too small to cover everything. If the next payday is still a couple of weeks away, you might need a loan to see you through the month. As its name suggests, a payday loan is specifically structured to help address your financial problems around the payday period.
- Personal loans. With the cost of living continuously rising in Singapore, it's easy to understand why everyone from the fresh graduate to the seasoned professional is struggling to make ends meet. The same is true especially in cases of financial emergencies. Personal loans are a popular and trusted option when it comes to meeting urgent financial needs, or investing in the future. Aside from helping in emergencies, personal loans can also be taken out to pay for property and assets.
- Bridging loans. Upgrading to a bigger condominium or private property from your first HDB flat is a huge financial investment. Property buying is notoriously difficult and expensive in Singapore, but it's definitely easier and more manageable with a bridging loan.
- A bridging loan is a short-term secured loan which you can use to pay for the down payment of your upgraded property while you wait for the sale proceeds of your old flat or home. Because the property market tends to be competitive, a bridging loan gets you the funds you need to clinch your next home before someone else picks it off the market. Bridging loans generally have higher interest rates. It can also be used to buy a commercial property.
- Foreigner loans. Foreigners residing and working in Singapore have plenty of options, similar to citizens and permanent residents. If you're in need for money, you can apply for specially-structured loans from licensed moneylenders. Borrowing from moneylenders is a more popular option than borrowing from banks for many foreigners, because of the ease of application and the convenience of terms.
- Debt consolidation. It's hard to focus on the future when you're still being chased by your past. If you're dealing with debt from previous moneylenders with extortionately high interest, or with credit card debt, late fees, and other financial obligations, you need a debt consolidation loan. This type of loan is designed to combine the balances of all your unsecured loan into one lump sum. You can get a lower interest rate for the sum. With a debt consolidation loan, you also get the ability to track your total amount and interest rate and to pay it off as a single, uncomplicated loan.
Knowing and comparing the type of loan are important because they give you an idea of how the loan is structured in terms of application, payment fees, and schedule.
Compare how much you need versus how much they can offer.
Now that you've compared your options using quality reviews, benefits, and loan types, it's time to look at one of the most critical aspects of the transaction. The amount of money you can borrow differs from moneylender to moneylender, and package to package.
Licensed and credible moneylenders usually put a limit on how much anyone can borrow. This loan cap is meant to protect the company and other borrowers from loan default. This limit is only usually seen in unsecured loans. If you can get a secured loan, you won't have to worry about matching your loan needs and what moneylending can offer.
This table gives you a general idea of how much money you can borrow. If you can't borrow enough money to cover your needs, you need to look for other sources of funds to go along with your loan.
Singapore Citizens and Permanent Residents
Foreigners Residing in Singapore
Less than $10000
At least $10000 to less than $20000
At least $20000
6x monthly income
6x monthly income
Compare the fees and interest rates charged by moneylenders
Interest rates depend on the moneylending company and the loan package you are getting. Because it works as a percent, you should expect a bigger interest if you take out a bigger loan. You can expect a maximum interest rate of 4% per month. This maximum applies regardless of your annual income and whether or not your loan is secured.
Moneylenders tend to be competitive when it comes to interest rates, driving it down to the lowest yet most reasonable price. As you're comparing interest rates and other charged fees, keep in mind that the amount should be balanced by a well-paced and feasible repayment schedule.
You should also compare late interest fees, which are computed based on the unpaid balance of the principal. The maximum rate of late interest is also 4% per month after the repayment deadline.
When it comes to other fees charged by moneylenders, keep in mind that moneylenders can only charge $60 or less for each month of late repayment, a fee of 10% or less of the principal when a loan is granted, and legal costs for a successful claim for the recovery of a loan. Lastly, the total charges on any loan, which include the interest, late interest, administrative fee, and late fee cannot exceed the amount of the principal loan.
Things to Consider When Getting a Loan from Moneylenders
Once you've narrowed down your options, you can start getting ready for your loan application. The process can be quick and easy. Many people are surprised by how convenient getting a loan can be.
Before you get started, there are some things you need to consider. These are the factors worth double or triple-checking.
The moneylender is licensed.
The last thing you want to do in a financial emergency is to get caught up in a scam. There are plenty of moneylenders out there with great advertisements and too-good-to-be-true loans. You might end up falling victim to their predatory schemes.
Unlicensed companies are usually those who solicit borrowers through SMS, phone calls, flyers, or emails. These forms of marketing are all not allowed under the law. Trustworthy moneylenders can be found through business and moneylending directories, through an online website, or through their physical office or premises.
One of your best bets for legal protection is checking for the company's license. The Singapore Ministry of Law regularly updates a list of licensed moneylending online, which you can find here. A quick check online can save you a lot of trouble and heartache.
The details of the loan are the same as advertised.
Don't rush into signing a contract of loan after seeing an attractive ad. Always check the details of the contract, including the fine print. If there are terms in the loan that you don't understand fully, you are entitled to an explanation. In fact, moneylenders are legally required to explain the contract of loan in a language you can understand.
Check and double-check the details covering the repayment schedule, the interest rate, and the late payment. Always get a copy of the contract.
You have the requirements needed to apply for a loan.
Unsecured loans also need to go through the proper and legal process of application and verification. While the process is not as tedious as it would be with a bank, you still need to prepare some essential documents.
For example, moneylenders need to verify your age, basic details, and annual income. Most companies would ask for at least one form of ID, and for copies of your payslip in the last year.
Are you ready to get a loan for your next home, or to pay for your remaining bills? Start comparing your options with the unbiased reviews of our moneylending directory.