In this article, we are going to discuss how to take a loan from the best moneylender in Singapore. Also, we are going to discuss what to do when you find it inadequate to pay the loan back and things to do before taking a loan.
Why should a person take a loan in Singapore?
It is impossible to live in a city that is the most costly out there in society. Dealing with all the expenses and the cost in the costliest city of Singapore is difficult, so you will need a loan. You will need to have money to settle for medicinal bills and marriage expenses which cost a lot to the organiser. The whole process of booking things for a person’s wedding will take around $1000 in Singapore.
If you have money to spend on the expenses, it is good, and you don’t need a loan. But if you don’t have money to fulfil all the expenses, then you need to take a loan. This is because you might go into a huge debt if you take things without a loan.
You can take a loan from either a bank or its alternative moneylenders. The banks have a more complicated and also time-consuming process of accepting the loan. While the moneylender will only take around 4 – 5 minutes to accept and give you the money.
You can also take a loan from the moneylender if you require urgent cash. There is nothing such as 24 hours moneylender, and if you find one, they might be a fraud, so be cautious. Many people still think that borrowing from the moneylender is not a safe option. This is because the illegal lenders are in the market who scam the people and ruin their name. So it is a recommendation that all the lender should keep proof of authenticity with them at all times.
What are the things to do before you take a loan from anyone in the market?
Before you take a loan from anyone, there are a few things you need to search about. Here is a list of things that you need to search about and keep ready before you take a loan.
- Decide the kind of loan you want
Before asking for a personal or any other loan, you have to look at your requirements. You should check and see how much money you want and which loan can you afford. You will also have to check the situation for which you want to take a loan for either an emergency or normally. In case of trivial requirements, you can take a personal loan to fulfil all your needs.
- Investigation on the loan you want
You should research the things that you need to take the loan which you want.
- Get credit report
The first thing to do is to go to the bank or any website and receive your credit record. This will make sure that your score is good and which policy you can afford. You can either go to Moneylenders Credit Bureau (MLCB) or Credit Bureau Singapore (CBS).
- Check your eligibility
You will have to check to see if you are eligible to take a loan or not. You can see on the charts on the MinLaw website the maximum amount of loan you can take.
- Prepare the documents you need
Once you have decided on the loan and checked your eligibility to take a loan. Then you can start preparing all the records that you need at the time of taking the loan. You will need the following documents.
- Confirmation of earnings and employment.
- You will need your present credit record and also your CRF statement.
- You will need a tenure agreement, professional letter, employment permit, and bank statement.
When it gets to the topic of personal loan, lenders will never look at the credit report.
- Do you have a cap on the cost involved?
All the licensed moneylenders are expected to follow the rules and regulations of the MinLaw. There are certain limits and also things which they need to follow to say legal.
- The interest rate should not be higher than 4% a month.
- The later interest should not go higher than 4% a month.
- The late repayment fees should not be more than $60 each month.
- The administrative fees should not be more than 10% of the capital amount of the loan.
- Legal cost is required by the court for the authorised lender to recoup the loan value.
What should a person do once his loan is accepted?
If you have got a low interest rate personal loan Singapore, then it is good news for you. Because these kinds of personal loans are hard to get in the market due to the rules and regulations. Here are some of the things you need to do after the loan has been approved.
Documents to keep safe
These are the documents that you need to keep safe for future reference.
- A representation of the loan agreement which you have signed.
- Receipt of the payment you have made towards these loans.
- A record of account for the total of your loan amounts.
- Photocopies of all the documents, receipts, and other relevant documents regarding the loan.
Also, to protect and preserve your credit score on the perfect line. You will have to pay all your EMI on time so that your score keeps on increasing, as does your chance.
What to do when you are inadequate to pay the loan back amount?
Whenever there is default by the borrower, then the lender will hire the loan recovery agents. No laws state that such laws that say that lenders cannot appoint these debt recovery agents. Here are the things which you can do when you default in payment.
- Appeal for augmentation
You can request the lender to extend the period for repayment and call back the debt recovery agents.
- Register for insolvency
If you cannot pay the amount, you can file for bankruptcy. This will stop the accumulating interest and prevent the borrower from going under more debt.