If you’ve ever needed a quick cash solution in Singapore, you might have thought of getting a loan from a moneylender.
Usually, borrowing from a moneylender in Singapore can be a reliable way of getting yourself out of short-term financial hassles. However, you should ensure that borrowing from money is your best decision.
Things to check before opting to Borrow from a Moneylender
Not all licensed money lenders are the same, and with abundant choices, you can undoubtedly feel overwhelmed as to what to choose.
Therefore, before leaping, here are the seven essential things to check before finding a money lender in Singapore.
Does the Ministry of Law license the Money Lender?
First, you must verify whether the money lender is licensed by the Ministry of Law in Singapore. According to the law, any licensed money lender operating in Singapore has to be registered and follow the stipulated regulations provided by the regulatory body.
You can verify the official list of licensed moneylenders on the Ministry of Law’s website. It is constantly updated; thus, one should ensure that a chosen moneylender falls within the list. Opting for an unlicensed moneylender will lead to harassment, excessive interest rates charged on loans, and possibly some legal problems.
Check the Interest Rates and Fees
You should first be informed about the interest rates involved in loans. Licensed money lenders are governed by certain limits that concern interest rates. Presently, money lenders in Singapore have been allowed a maximum interest rate of 4% each month, irrespective of income level.
Further, beware of the charges that come along with accessing quick loans. Always request a breakdown of all interest rates and other fees. Importantly, never sign the contract if the whole thing is not crystal clear.
Ask About Moneylender’s Reputation and Review
In the lending business, reputation means everything. So, what are others saying about the money lender you are considering? Sites like Google Reviews and social networks like Facebook may help because clients usually get feedback about certain moneylenders’ operating habits. Beware of complaints about undisclosed fees, poor customer care, or other deceitful practices. A couple of negative reviews are just part of business, but seeing a pattern of complaints on these points is another bad sign.
Therefore, read online reviews, visit forums, or ask people you trust for recommendations.
Transparency in Loan Terms and Conditions
A suitable money lender will be transparent about the terms and conditions of your loan. Before you sign anything, ensure you fully understand essential aspects such as the repayment schedule, the loan tenure, any penalties for late payment, and the total cost of the loan, including interest and fees.
A suitable money lender will explain these terms clearly and give you a legally binding contract in writing.
Verify Their Physical Office Location
All licensed moneylenders in Singapore are required to operate from a physical office. This is where you’ll need to go to complete your loan application and verification process. Never entertain offers from moneylenders who only communicate online or over the phone without a verifiable office address.
Also, check whether the office address on the Ministry of Law website is authentic and accurate.
Quality of Customer Service
Good customer service is a reflection of the money lender’s professionalism. How they treat one even before signing up for the loan contract says a lot. Observe whether they are patient, allow you to ask questions, and explain things clearly and pleasantly.
A professional lender will respect your feelings and will be there to lead you through it without necessarily pressuring you.
Your Ability to Repay the Loan
This is one self-check you should not afford to ignore. Before you commit yourself to anything in the way of loans, be candid with your inner self on whether you can repay the loan.
Remember that borrowing is meant to get you out of a problem, not plunge deeper into problems. The suitable money lender will also assess your ability to pay back and may decline to lend you anything since that would harm your well-being.
Conclusion
Being thorough when choosing a moneylender to borrow from can enable you to avert pitfalls and assure you of faultless borrowing experiences. Although it might be time-consuming, it is worth the extra effort for reassurance reasons for your financial security and peace of mind.
Therefore, by carrying out the above checks, you’ll be better equipped to choose a reputable moneylender and secure a loan that will help you.