Applying for a loan is one of the most common ways to restore the balance of income and expenses, and if you need a money lender Singapore, it may take a very short time. Accident expenses, urgent medical bills, and any other unforeseen cash requirements can be best met by licensed money lenders today as they act as a practical substitute to the standard financial institutions. It is essential to know the loan application process with licensed money lenders in Singapore if you aim to borrow money safely and without any hidden fees or unfair practices.
In this guide, we’re going to explain the process involved to ensure you make the right decision.
What is a Money Lender in Singapore?
A money lender in Singapore is a legal entity that offers personal loans to people in Singapore who cannot borrow cash from a bank. Money lending institutions differ slightly from banks in that a borrower may have a poor credit history, but it will not exclude him from being accepted for a loan. However, it is advisable to borrow from only registered money lenders since some operators work in parallel without a license and may charge very high interest, as well as lack policy guidelines.
Why Should You Choose A Money Lender In Singapore?
The Ministry of Law regulates money lending businesses in Singapore, and therefore, licensed money lenders do business following the set legal provisions. This means that unscrupulous lenders cannot exploit borrowers and cannot be charged other unaltered fees. In addition to this, the loan application processes with the licensed money lenders in Singapore are relatively faster and smoother than those of the banks, and therefore, it is Easier and quicker to access funds.
Step-by-Step Guide to the Loan Application Process with a Money Lender Singapore:
If you are planning to obtain a loan from a money lender in Singapore, you must know how it works. Here’s a breakdown of what to expect:
Step 1: Check Your Eligibility
It is advisable to satisfy the basic requirements for getting a loan from licensed money lenders before applying for one. While specific requirements may vary, most money lenders in Singapore will look for the following:
- Age: You should be at least 21 years of age and at most 65 years of age.
- Residency: To demonstrate writing ability, you must be a Singaporean, a Singapore Permanent Resident, or a foreigner with a valid Employment Pass or S Pass.
- Income: Monthly income is an important consideration for the described model. Many money lenders want you to have a job, and the minimum amount of income depends on individual lenders. For Singaporeans and Permanent Residents, the income threshold usually falls around SGD 1,500 per month. The stipulation can stretch from SGD 2000 to SGD 3000 for citizens of other nations.
You can avoid wasting your time by validating the requirements for an application before you apply.
Step 2: Study Classified Money Lenders
There is a licensed list in Singapore, and you must do your research properly before applying for your loan. However, the Ministry of Law’s website has a list of licensed lenders, so you know you’re dealing with a legitimate entity, and you can easily find one.
When researching and for verified borrowers, use reviews, ratings, and feedback from previous borrowers. To begin with, it is necessary to handpick a Singapore money lender with uninterruptible terms, a robust track of the past, and favorable previous client experiences.
Step 3: Decide on the Loan Type
Licensed money lenders in Singapore typically offer different types of loans, including:
- Personal Loans: Loans that have been unsecured and can be utilized for payment of almost any purpose, such as paying medical expenses or home renovations.
- Payday Loans: Short-term loans are designed for the quick need of money between paychecks.
- Debt Consolidation Loans: If you have several outstanding debts, you may combine them into one loan with a lower interest rate.
Once you’ve chosen the type of loan, decide how much money you want to borrow and how long it will take to pay back the loan. Borrow what you can afford to repay.
Step 4: Gather Your Documents
To take out a loan with a money lender in Singapore, a number of documents will need to be supplied to prove your identity and income. Typically, you will need:
- Identity Proof: For Singaporeans, a valid NRIC; for foreigners, a valid passport.
- Proof of Income: A recent payslip or a recent bank statement showing how much of the salary is deposited.
- Employment Details: Documentation from your employer that you work for them.
- Proof of Residence: Your name on a utility bill or a rental agreement.
These documents add up to how much the money lender assesses your financial situation and ability to repay the loan.
Step 5: Submit Your Application
Once you’ve collected all of your documents, you can start your loan application. The majority of money lenders in Singapore have websites that allow you to apply from the comfort of your home by using their online applications. You can also go to apply personally at the money lender’s office.
You better double-check to make sure your application is accurate and complete so you don’t get caught up. If you provide all the required information honestly, then you will have a smooth approval process.
Step 6: Loan Approval and Agreement
Once you’ve submitted your application, the money lender Singapore will look into your application details and then decide if you qualify for the loan. If approved, you will be presented with a loan agreement that outlines the terms and conditions, including:
- Loan Amount: How much, in total, you will get.
- Interest Rate: Under the law, Singapore-licensed money lenders are obligated to charge interest rates of no more than 4% a month.
- Repayment Period: The length of time you’ll be able to repay the loan, usually a few months to a few years or more.
- Late Fees: Find out what the penalties are if you miss or make a late payment.
Think about this: Before signing any such agreement, you should be very clear about the terms, especially the interest rate and repayment schedule.
Step 7: Receive Your Loan
After signing the agreement, the payment will be made. The loan process also varies by lender. In many cases, you will get the loan amount the same day, while in other cases, it will take 1-2 business days.
