14 Sep Taking Personal Loan from a Legal Money Lender in Singapore
Are you one of those people who are always in need of cash? You have to pay your bills, but there is no money left for groceries or gas.
This is the time when loans come into play. They offer an opportunity to get some quick cash so you can keep living your life without any interruption.
But not all loans are created equal, and before taking out a loan, it’s important that you know what type of loan suits your needs best.
A personal loan is designed to cover short-term expenses, such as vacations, medical emergencies, home repairs, or paying off credit card balances.
It offers lower rates than most other types of loans with fixed terms ranging from 3 months up to 36 months and no collateral required!
These days, there are many companies that offer personal loans to people who need them. The process is easy because you don’t even have to go into a branch – all it takes is filling out an online form!
The thing is, there are many legal money lenders in Singapore but do they all provide the same services?
It’s hard to know what you’re getting when you take out a personal loan in Singapore because it can be difficult to find reviews and feedback about the company.
This blog post will tell you everything you need to know about taking out a personal loan from a legal money lender in Singapore.
Is A Licensed Moneylender the Same as An “Ah Long”?
The term “ah long” is a Cantonese slang that means loan shark. The name was derived from the word “long,” which translates to dragon in Chinese.
So, an ah long is someone who earns their living lending money to people at high-interest rates and often with terrible terms.
A common misconception among those without much knowledge of the industry is that a legal money lender in Singapore is also an ah long. This couldn’t be further from the truth!
A legal money lender in Singapore offers loans under strict guidelines, and they charge lower interest rates than illegal lenders do – so if you’re considering getting a loan, make sure it’s from one of these professionals instead of an “ah long.”
A legal money lender in Singapore will typically charge an interest rate of up to 4% per month (or 48% per year), whereas ah longs can charge up to 12% monthly (or 144% annualized).
While there are many similarities between these two types of companies, it’s worth noting that they are not one and the same thing and should not be confused as such.
Moneylenders Act and Rules Singapore
A legal money lender in Singapore is any person who carries on the business of lending or borrowing, either with or without security and includes a pawnbroker.
Money lenders are regulated by the Monetary Authority of Singapore. They also have to comply with rules set out by their respective trade associations.
The Moneylenders Act and Rules Singapore are a set of rules that regulate the activities of money lending agencies in Singapore.
These rules have been put into place to protect borrowers from being exploited by lenders, as well as to provide guidelines for lending practices.
These rules cover how much they may charge for loans from borrowers at various risk levels and what kind of security they can take from them.
The basic rule is that a borrower’s debts must not exceed 50% of his monthly income before taxes for him to qualify for a loan. A moneylender cannot lend more than $2,000 to someone earning less than $1,800 per month before taxes.
How Much Can You Loan from a Legal Money Lender in Singapore?
As a borrower, you are under the impression that there is no need to borrow from a legal money lender in Singapore. You might have even heard that it’s risky or not worth your time.
However, if you’re struggling with debt, then this may be just what you’re looking for. A loan can help ease some of your financial burdens and allow you to focus on more important things like work and family.
A legal money lender is one of the best options for those who need a quick and easy cash loan.
Singaporean residents can receive loans from as low as S$2,000 to as high as S$200,000 (or even higher).
The amount you can borrow will depend on your salary and other factors.
What Are The Interest Rates Moneylenders Can Charge?
Money lending is a business that many people are interested in.
The interest rates money lenders can charge vary depending on the lender and the borrower, but it’s important to understand what these rates mean for your financial situation before you take out any type of loan.
Lenders typically use an annual percentage rate (APR) to express this cost because it’s easier to understand than a complicated decimal number.
The average interest rate for a money lender is about 2% – 5%. Interest rates vary depending on the country you are in, but since most countries have laws limiting how much can be charged, there really isn’t any way to know what the best rate is.
Interest rates are calculated on a per-month basis, meaning that if you take out a loan for $1,000 at a 4% annual percentage rate (APR) with monthly compounding, your total cost of borrowing will be $1,040 after two months.
And that doesn’t include any fees or penalties associated with late payments or defaulting on the loan.
What Do You Need to Do Before Borrowing from a Legal Money Lender in Singapore?
If you’re in dire need of cash, but can’t find a bank to loan it to you, then legal money lenders are the way forward.
But before borrowing from one of these types of financial institutions, make sure that you’ve done your homework.
Decide On the Type of Loan That You Need from a Legal Money Lender
The first thing that you need to figure out when looking for a loan is what type of loan do you need? If you are in need of short-term loans, then there are plenty of lenders who will offer this type of loan.
But if it’s the long-term or medium-term loans that you’re after, then licensed moneylenders can help with these types as well. The only difference is the amount and length of time they’ll offer the loan for.
There are many different factors that go into deciding which type of lender to use, whether it be geographic location, interest rates, or fees charged by each lender. Ultimately though, it’s up to you because no two people have the same financial situation!
Get Your Credit Report
Getting a personal loan is a great way to get out of debt or make some money for your next big purchase. But before you take the leap, it’s important that you check your credit report and score.
The higher your credit score, the lower your interest rate will be, and the better terms you can negotiate with lenders.
If there are any discrepancies in your report, contact those companies immediately to correct them, as they may negatively impact whether or not you receive financing from an individual lender.
There are many ways to get your credit report. You can go to a government agency that provides these services, but you may have better luck going through the non-governmental agencies.
There are several companies that provide this service for a small fee of around SGD20-30.
They will also give you instructions on how often it is best to check your credit score and what other steps you should take if there is a problem with your score.
Prepare All the Documents that You’ll Need
To get a loan in the current economic climate, you need to be prepared with all the documents that your lender will require.
The more these are prepared in advance and neatly organized, the less time it will take for you to fill out paperwork when applying for a loan.
There are many documents that need to be prepared for the lender. These include your driver’s license, social security card, bank statements, and more. It is important that all of these documents are in order before you start looking for a lender.
Wrapping It Up…
The average Singaporean spends more than half of their salary on living expenses. This means that most people have very little leftover for savings or taking care of emergencies.
If you are one of these individuals, then it is time to take a closer look at the personal loans offered by legal money lenders in Singapore. These loans can help you get back on track financially without having to go into debt with high-interest rates and hidden fees.
A personal loan from a legal money lender in Singapore will allow you to pay off your debts, make home improvements or even start a small business if that’s something that interests you! Best of all, they offer flexible repayment periods, so there is no need for any long-term commitments.