There are licensed moneylenders and illegal moneylenders. Licensed moneylenders though are different. They will almost function like banking institution does. They normally offer personal loans to individuals with urgent needs. And when the repayment is overdue, they handle it differently.
They will not take unkind actions like harassment their borrower. They instead, will send them notice of reminders. These lenders operate legally in Singapore. Accredited moneylenders in Singapore get confirmed by the Singaporean Ministry of Law.
Consider These Factors Before Borrowing From Licensed Lenders
- Consider other alternatives that are available. These need to help you obtain funds. Options like government agency schemes.
- Confirm the provisions of the contract you are signing. Talk with the certified moneylender since the contracts are binding. This agreement is necessary since it’s a requirement by law. Evaluate whether you are able to follow the conditions. Consider your income as well as financial commitments as well
- Make certain that you fully understand the loan terms. Reread the contract and more so how you have to repay the loan. Confirm the time period you will be required to pay. Be sure you know the interest rates charged. These details should usually be communicated at length. The moneylender you choose to work with should clarify all this.
- You need to look for the moneylender with best terms. Avoid hurrying to obtain a personal loan. This is the conditions and terms are appealing to you. It’s important you ensure the terms are good for you
- Think cautiously before you sign a contract that has a caveat. A caveat is a notice that stops some actions from happening. Thus the issuing party needs to be informed of any issues.
- Also, beware when a moneylender requests for your User ID. You should be keen when they also ask for you SingPass password. Or when they keep important documents like your national ID. Or if they retain work permits, ATM cards or driver’s license etc.
- Make sure the licensed moneylender gives you the loan. And they do their checks. They need to be able to adhere to due procedures of lending.
- A few limitations that go with borrowing from these lenders include. You will incur penalties when you fail to make payment. The payments need to be made on time. Even then you can access two loan types.
It is essential to realize this. In order for you to obtain a loan, you need collateral. The asset pledge needs to be worth more the loan. That is the amount you want to take out plus interest charged.
Once you sign over the rights to the pledged assets. The licensed lender will retain its titles together with transfer forms. The benefit of the secured loans is the amount accessible. The chance of obtaining a larger amount is higher. Should it happen that the value of the asset declines. That is it goes below outstanding loan amount remaining. Your lender may again require a lump amount to pay the difference. Secured loans usually have rather lower rates of interest.
This type of loan requires no assets or collateral. And your lender will simply take legal action. This often will involve court procedures against the debtor. The court may then compel the debtor to repay the remaining amount. When they don’t have the required amount a solution is open. An order might be placed for sale of the property. The proceeds from this sale will help repay the outstanding loan.
Let’s consider the student loan. The benefit of the unsecured loans is that they do not create a risk to many borrower’s assets. And they happen to be processed a lot faster than regular loans. The drawbacks are the interest rates charged. The rates may be a lot higher. As well as the loan has no lower limit on the amount you can borrow.
Benefits Of Choosing Licensed Moneylender
In Singapore, licensed moneylenders operate per rules. These guidelines are stipulated by the Singaporean government. And failure comply means they risk legal penalties. The penalties include revoking of their licenses or fines. Due to this, the repayment plan is always reasonable.
These lenders always have affordable interest rates. Licensed moneylenders need to stick to government regulations and rules. For instance, depending on your monthly earnings. Every time you would like to borrow a loan. A licensed moneylender will certainly offer you a loan. Although there will be a set limit for the amount you get. The process for determining the amount you qualify for is standardized. Thus it is the same for all licensed lenders.
Licensed moneylenders approve loans often within a short time. It can happen in just a few days and you have the cash. They won’t focus a lot on your credit record. The procedure of taking out a loan is also very efficient.
The moneylenders’ Registry has strictly laid down rules. These rules determine how moneylenders may advertise. These adverts are aimed at the potential borrowers. Thus a specific method is identified which they use. Thus they may communicate with the clients. The law necessitates that they have a physical office space. Thus a possible borrower can visit them should they have any queries.
They hold a valid license for their operations. They also have a registered landline. And also have a physical office where you could get important information. Also, this is used when checks for private information or verification are required. These checks will determine your eligibility for loans. Therefore you don’t have to provide them with your SingPass Login. This is because it has sensitive information. This is where every citizen’s information is contained in Singapore.
Before getting loans from licensed moneylenders read much. Ensure you know the different laws and rules for money lending. This way, your request for the lender’s certificate. You are familiar with the things to check for. You can then compare these details on it against the information you have. You should observe caution. This way you will avoid dealing with unlicensed lenders.