How Much Can a Customer Borrow From Singapore Licensed Moneylender?
As part of the financial organizations, licensed moneylenders are authorized to grant loans. And these loans are repaid within a stipulated period.
On short notice, licensed moneylenders will come to your aid. What loan types do they offer? Moneylenders offer different types of loans, including payday loans and personal loans.
But first, you have to check that the moneylender you select is accredited. They should adhere to the regulations and rules put in place to protect both customers and lenders.
In Singapore, unlicensed moneylenders are essentially loan sharks who will not hesitate to swindle you out of a home, even perpetrate identity theft and in the process ruin you?
To help facilitate the smooth transition of your personal loan application, below are the basic requirements for a loan:
- Should be aged between 21 to 60 years
- Citizen or Permanent Resident
- Making at least S$1,700 each month
- You might require a guarantor in some situations
Once you have fulfilled the loan requirements depending on the lender you are working with. You can then submit your loan application.
Note: Only take an amount that you actually need. Consider your earnings to be able to come up with an amount that you can comfortably repay.
Types Of Loans In Singapore
In Singapore, there are 2 types of loans that clients can choose from as they are borrowing from moneylenders:
Unsecured loan: This is a type of loan that is granted based on your history or score and without needing any kind of collateral.
Secured loan: This is a loan type that you can access after presenting the moneylender some kind of collateral. And this will ensure that you pay the loan back.
How Much I Can Borrow
When it comes to secured loans, any loan amount is accessible to you. As for the unsecured loans, the amount you can get:
- An amount of $3,000, when your annual wages are below $20,000;
- An amount totaling your 2 months’ salary, when your annual wages are $20,000 and more but below than $30,000;
- An amount totaling 4 months your income, when your annual wages are $30,000 and above but below $120,000; and
- Any loan amount, when your annual salary is $120,000 and above.
Interest Rates That Moneylenders Charge
Since October 2015, licensed moneylenders are to charge a maximum of 4% as interest rates. This is despite the loan amount borrowed. The 4 percent interest charge is applied to both unsecured and secured loans.
If and when you fail to make a payment in a single month, the interest charged for the late repayment still remains 4 percent. This rate is charged only to the missed/delayed payments.
Fees Charged By Licensed Lenders
In Singapore, licensed lenders are only permitted to charge the following fees on all loans they offer:
When you get a personal loan, you can incur a cost not exceeding 10 % of your principal amount taken.
For defaulted monthly installment repayment, you will incur a charged amount of $60. note that this amount is charged only on the missed payments.
When a moneylender files a recovery claim for the outstanding loan, and it is successful. You will be required by the court to pay for the ordered legal fees.
Why I Should Borrow From Licensed Moneylenders
In Singapore, licensed moneylenders are able to provide you with financial help. You can visit a licensed lender to confirm whether you meet the requirements. If you urgently need quick cash for settling a debt or when you would like to cover an emergency health problem or accident.
A legal moneylender is able to help you find a solution to your financial needs. In such instances, shop around to find a money lender who is ready to work with you. The moneylender has to be ready to consider your financial needs and offer you lower rates.
Usually, moneylenders offer more flexible approval process, which allows you to get your loan within the shortest time possible. Certainly, it will be faster than when you are to get a loan from a bank.
Most lenders carry out minimum background checks on their clients, requesting only a few documents form you.
Since moneylenders have stringent interest charges established by government bodies, getting loans from moneylenders will make loan repayment much simpler for you than taking loans from other money lending institutions.
How To Tell Whether a Moneylender Is Licensed Or Not?
Avoid getting loans from unlicensed moneylenders. How can you do this? Be sure to confirm that a moneylender is accredited by checking for their name from the list of the licensed moneylenders in Singapore.
Even though moneylenders are licensed, you should be cautious if they:
- Act in an intimidating manner or use abusive language towards you.
- They want to know your SingPass password and user ID.
- They hold onto your NRIC card and any other private ID documentation (e.g. passport, driver’s license, work permit, ATM card or employment pass).
- They want you to put your signature on a blank or incomplete agreement.
- They offer you a loan and fail to offer you the loan agreement copy and failing to properly explain to you every condition and terms of the loan.
- They give you a loan without applying due diligence (e.g. email or SMS before they receive your application form and necessary supporting documents (like payslips or income tax assessment), approve a loan on the phone.
- They retain a portion of your principal amount for whatever reason.
The above-mentioned practices are not to be tolerated. When you come across such lender, you have to report them immediately to the Moneylenders Registry. Ensure to provide information like the name of the moneylender’s business, contact and license numbers.
Licensed moneylenders are authorized to grant loans in accordance with the moneylender’s act. These lenders will come to your aid whenever you are faced with an urgent situation that needs your attention.
Even then, there is a set amount of money that you can take out from licensed lenders based on your income level, employment and credit status. And remember to only deal with a licensed lender to avoid falling victim to scammers.