30 Jun How to Get Private Money Loans in Singapore
Money lending activities have long carried a negative stigma in Singapore, being portrayed as unwanted scenarios within local dramas and news. Yet, for the vast majority of loans made each day, these transactions have ended in a win-win situation. Indeed, both the money lender in Singapore and their client profit from the agreement. The questions then arise, why, when and how can you too gain from taking a private money loan?
Getting a loan from a private money lender
Check for their license
When getting a loan from a moneylender in Singapore, it is important to ensure that they are authorised and licensed. The Ministry of Law maintains a Registry of Moneylenders which is a list of licensed moneylenders in Singapore. Before you talk to any money lending institution, you should check this list to see if they are licensed in Singapore.
This practice can protect you from unsavoury practices in the industry. For instance, an unlicensed moneylender could extend you a huge loan that you have no real means of repaying while leveraging a huge interest rate over your head. At the same time, they could employ unethical debt collection methods to make your life difficult.
Filling out an initial application form
All moneylenders will request that you fill out their application form which would typically check for the requested type of loan and loan sum. Once filled out, they will begin to perform the necessary background and credit score checks. For a private moneylender in Singapore, this should take up to 24 hours. If everything checks out, they will contact you to proceed.
During the initial meetup, the moneylender will likely interview you about your plans to repay. In doing so, they would be advising you on the viability of your plan and helping to structure a repayment strategy that is beneficial to both parties. Afterall, a timely repayment of both principal and interest is desired by both you and the moneylender.
Collecting the principal sum
Once the loan has been approved, the moneylender will invite you down to sign a contract and collect the principal sum. It should be noted that all licensed moneylenders are obligated to carry out an in-person signing and collection. As such, should a moneylender offer to wire you the money rather than meeting you in person, they are likely an unlicensed financial institution.
Why take a private loan
Let us address the elephant in the room, which type of financial institution to get a loan from. Why would you opt to take a loan from a private money lender Singapore company as opposed to a bank? While banks continue to be the default loan partner for first time borrowers, they are outperformed in several areas.
Speed of loan approval
A huge difference between banks and moneylenders is the time required to approve your loan application. Banks typically incorporate a strict background and credit check in order to meet their risk management needs. As such, from the time of application, you can expect several days or even weeks of waiting time depending on the size of the loan.
In contrast, a private licensed moneylender would be able to extend you a loan within 24 hours. With less stringent criteria, they are able to ease your financial trouble in a rapid time.
Possibility of unsecured loans
Often times, when you are in an urgent financial situation, you may not have ready assets to be used as collateral in a loan. As such, since banks frequently only offer secured loans, you may not qualify under their terms and conditions. For example, you might have investments with low liquidity. As such, you won’t be able to convert it to assets that can easily be used as collateral within a week.
On the other hand, private licensed moneylenders in Singapore do offer unsecured loans. This means that they do not require any collateral to be attached and can thus quickly release the loan amount to you.
Lower requirements for qualification
At the core of any loan qualification assessment is your credit score. Your credit score gives a financier a snapshot of your current and past credit situation. This is used to determine the likelihood that you will be willing and able to repay the loan in a timely fashion. Typically, banks require a better credit score as opposed to a licensed moneylender. As such, it could be difficult for you to qualify for a bank loan.
Types of private money loans
There are several types of loans that you can get from a private money lender Singapore firm. These different types of loans cater to different needs that you might have.
As alluded to in the name, business loans are designed to help your company with its financial needs. Be it an injection of capital for asset acquisition or a consolidation of debts, a business loan can give your company a boost.
When taking a business loan, you will be asked for information about your business. In particular, the licensed moneylender will want to learn about its profitability, intended use of the loan and your plan to pay the interest. So long as the presented information gives the money lender confidence, your business should be given the loan.
A payday loan is as one might expect used to supplement a future month’s payday. If you have a pressing finance issue since payday has not arrived, then a payday loan is for you. Oftentimes, payday loans feature smaller sums, comprising of your monthly salary. The intention here is to advance your salary so that you have the necessary money to meet your monthly needs.
An advantage of payday loans is their relatively higher speed of approval. Given their routines, smaller values and unsecured structure, licensed moneylenders typically grant you a payday loan quickly.
A bridge loan is similar to a payday loan in terms of its short duration. You would find a bridge loan desirable if you need an injection of cash before your next capital flow comes in. For example, if you are changing houses but are only selling your home a year from now, then a bridge loan can help finance your new house in the meantime. In this sense, it is helping to bridge your finances between two significant points in time. However, given the shorter duration of the loan, you can expect high interest rates.
A personal loan can be used as a catch-all type of loan. If you are looking to get a loan yet your situation does not meet any of those described before, then a personal loan is for you. The moneylender will still wish to find out about your intended use of the loan and how you intend to pay it back. Nonetheless, given its more variable nature, a personal loan can be highly useful for individuals of all situations.
Consult JD Credit on your loan needs
JD Credit is a licensed moneylender in Singapore with many years of experience in the industry. Our vision is to achieve excellence when serving customers provide the best information and finest service for our customers and lead in the money lending industry. Speak to us today to get low interest loans that help today!