Are you looking to borrow some money to cover your immediate needs? If you find yourself in a tough financial situation, an easy and quick access to emergency funds can get you out of such issue. But the question is – who can help you with your money problem? How can you get the amount of money you need without having to go through a tedious and lengthy process?

This is the time that it may be worth considering the help of a licensed moneylender in Singapore. In such situations, you can let out a sigh of relief knowing that a moneylender can assist you during difficult financial concerns. No matter what type of issue it may be such as a short-term cashflow problem, or a credit card or hospital bill that needs to be paid, you can consult a reliable and licensed moneylender for such concerns. But at the same time, you have to realize that a personal loan is an unsecured debt. This means that it is not like an auto or home loan, which requires collateral. Thus, you can expect the interest rates to be a little higher than average. But this should not stop you from considering this as an option since if you have a slim chance of qualifying for a bank loan, then a moneylender’s assistance may just be a viable option in your situation. It is worth noting that for lenders who are a certain risk of defaulting on their loan may be subjected to eligibility criteria and screening from a moneylender. This is a way to make sure that even if they have such records, there is a possibility for them to settle the loaned amount at the set timeline for payment.

As for the borrower, you need to check further the rates and fees involved. You may want to take note of the details about your loan, and make sure there are no hidden fees added on top of the principal amount. After all, if you have never taken up a personal loan from a moneylender before, you need to do your homework to be sure nothing goes wrong along the way.

Here are some of the important items to look into before you apply for a personal loan to cover your immediate financial concerns.

1. Determine the Loan Tenure

It is important to note that a number of personal loans provided by banks usually require a tenure with a minimum of 12 months, which can give them the assurance of being fully paid by the borrower. The said duration of the loan depends from one lending institution to another, so it is best to know exactly what the length of time will be to be able to prepare well for it.

The sad thing is that there are some people who choose to pay the loan off earlier with the hopes of being free from extra fees and high interest rates. You will be surprised to know that when a tenure is given to you, it is mandatory for you to comply with it. Hence, paying the loan off at an earlier time will result to a penalty. This is why it is better that you follow the stated tenure to free yourself from excess fees.

Be more practical and consider several options available to you at the moment that you are searching for a means of taking up a loan. In case you only need a small amount, let’s say to cover the payment for your utility bill or credit card payment, then it may be worth consulting a licensed moneylender for assistance. The reason for this is that you have a chance to repay the loan at a shorter time, which means there is no chance of accumulating astronomical fees in the end. While you may have to prepare for higher interest rates, the good thing is that the loan can be fully paid off in a month or so.

2. Inquire about the Interest Rates

Make it a point to get clear about the lender’s published rates. This means that the rates published must be the effective or actual rates you are getting instead of simply the advertised interest rates. To put it simply, the effective rates would be the actual interest that you will need to pay at the end of the term of your loan. This will give you an idea how much you exactly need to settle, and you can prepare for the amount even before the deadline for payment comes.

Comparing one lender’s rates with others can help you with your decision. This is why you may check out websites of different moneylenders in Singapore to determine which among these organisations offer the better and more competitive rates ideal for your needs and budget. Always think about your capacity to pay your loan off since you do not want to subject yourself in a tougher financial situation when you take a loan out.

3. Identify the Fees and Charges included

In addition to interest rates, there are other things you need to be aware of before you head out to borrow some cash from a licensed moneylender in Singapore. For instance, there are things to consider such as processing fees, late charges, default fees, cancellation fees, and similar others that are applicable to your loan.

Do your best to get clear with the moneylender and inquire further to know what you are getting yourself into. If you have reservations or if you are unclear with some of the details stipulated in the contract, never hesitate to ask for clarifications. Always be sure of the whole thing prior to affixing your signature.

4. Know more about your Eligibility for a Loan

There are different criteria that are set by moneylenders when it comes to screening applicants or borrowers. You may want to check and know your eligibility by contacting the Credit Bureau Singapore to inquire about your repayment history and credit rating. In case you plan on taking out some cash from a Singapore licensed moneylender, then you will need to check with the Moneylenders Credit Bureau (MLCB) for your inquiries. By heading to the MLCB, you can obtain relevant information regarding your repayment records and loan applications lodged to licensed moneylenders in the country.

But there are also some paperwork required by lending institutions to potential borrowers. For bank loans, you will need to meet the following eligibility criteria:

  • Income amounting to $30,000 for Singaporeans or PRs or $42,000 for foreigners. There is a limited amount of cash you can loan depending on your salary, and you can receive the highest amount if you are making about $30,000 to $120,000 in a year.
  • If you are a Singaporean, you need to submit some documents along with your application form. These include a photocopy of your NRIC, Income Tax Notice of Assessment for the past 2 years, CPF statement for the past 12 months (applicable to salaried workers), and bank statements for a 3-month period (for self employed individuals). A proof of residency, your latest bank statement and payslip, and the SingPass are also some of the additional requirements. For verification purposes, you will have to login using your SingPass to the IRAS, HBD, and CPF.
  • Foreigners looking to take out a loan from a licensed moneylender will need to submit a photocopy of their employment pass and passport (front and back page), along with their S Pass, work permit, or employment pass. The latest copy of the Income Tax Notice of Assessment and a computerised original copy of payslip are required, as well. Among the other supporting documents you may need to present include a tenancy contract, proof of residency, most recent copy of your bank statements, and payslip for the last three months.

Be sure to submit a complete set of requirements when you apply for a loan to increase your chances of getting a positive feedback from the lending institution.

Published On: September 15th, 2023

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