Shopping for a Loan in Singapore: The Importance of Licensed Moneylenders
When it comes to the cost of living, Singapore is one of the most expensive cities in the world. And those costs just keep rising. Understandably, many residents experience financial difficulties and must take out loans on occasion.
If you find yourself in such a situation, you could rely on a licensed moneylender. That person’s reliability and expertise could keep you from more serious problems with money.
What Is a Moneylender?
A moneylender is a businessperson who specializes in arranging personal loans quickly. If you take out one of these loans, you’ll probably repay it over a relatively brief period. Of course, it can be helpful to have a shorter span of time for repaying. It gets you out of debt as quickly as possible.
Most likely, you’ll make these loan payments online or in person at your moneylender’s office. Unfortunately, in Singapore we do not have a situation where your moneylender or a representative might go to your home to accept payments for a convenient system. As a matter of fact, moving towards a SmartCity, you may find yourself applying for a loan become virtualize and funds transfer to your bank account immediately upon approval.
Many benefits come with the moneylending process. For one thing, it’s easy to obtain a loan from one of these professionals, even if your credit history isn’t exactly stellar. It’s also easy to find moneylenders. A simple internet search will turn up lots of qualified individuals, and many moneylenders set up shop inside busy commercial centers and major shopping areas.
Your moneylender should be able to approve your loan fast, perhaps right away. What’s more, your moneylender will likely give you a range of repayment options. He or she might let you make payments once a week — or maybe even once a day! Frequent repayments help some people to stay disciplined with their spending. They’re not tempted to go on a shopping spree if they know a loan payment is due that week or that day.
What Is a Moneylender’s License?
Always look for moneylenders who hold active licenses from the Singapore government. Those pros will be knowledgeable, reputable and trustworthy, and they won’t hit you with any hidden fees.
In order to get a moneylender’s license in Singapore, a person must be at least 21 years old. He or she must pass an exam (which costs $130 to take) as well as a thorough Registry of Moneylender background check. After successfully completing those two steps, the candidate will fill out an online application and submit a $600 fee, a sum that isn’t refundable.
On top of that, the government must approve the applicant’s proposed place of business. This person is also required to send proof of a $20,000 insurance guarantee or banker’s guarantee to the Singapore Accountant-General’s Department. Not to mention, it costs more than $1,300 per year to renew a moneylender’s license.
In short, Singapore is serious about regulating its moneylenders. There’s even a series of laws called the Moneylenders Act to govern the industry and its practitioners. For instance, your licensed moneylender is not allowed to get in touch with any of your relatives unless you tell him or her that it’s OK to do so.
You should derive peace of mind from this system. You can feel confident that your licensed moneylender is always adhering to the highest ethical principles.
Finding a Lender, Securing a Loan
You know you need a loan. Your first step is to figure out your ideal loan amount.
Calculating that amount involves balancing a few key numbers. Of course, you have to get enough money to plug your financial hole. At the same time, your loan can’t be too large or you won’t be able to make your debt servicing payments.
A debt servicing payment is the interest rate plus the principal, which is the portion of the loan that you agree in writing to pay back every so often. In most cases, the Monetary Authority of Singapore won’t permit a lender to charge a debt servicing payment that exceeds 60 percent of a borrower’s income.
Before you start to look for a lender, examine your monthly budget carefully. That way, you can arrive at a debt servicing payment you’re sure you can afford. And you should always set aside some money each month for emergencies like a sickness or injury.
Compare licensed lenders before you select one. Scour the internet for a business with competitive interest rates, outstanding customer reviews and reasonably flexible repayment terms.
Once you’ve found what you think is the best loan in Singapore for your needs, you can apply online. You should have your answer within minutes. Your licensed moneylender will then give you instructions as far as how to proceed.
In the end, taking out a loan is like getting surgery. There’s always a little risk involved, but it can be a real lifesaver. Just as you wouldn’t get a surgical operation for fun, you shouldn’t seek a loan just to get some extra spending money. Only take out loans when you need to.
Like a gifted surgeon, a licensed moneylender can be extremely valuable. He or she will explain your options fully, give you useful advice and help you to restore your financial health.