Sometimes emergencies can happen in the least expected circumstances. Most often than not these emergencies needs cash. Getting the money from somebody is not easy, but the good news is if you are living in Singapore there are many reliable licensed moneylenders. You have to be careful though for there are several reports regarding loan sharks transactions too. Some of these loan sharks present themselves to be professional moneylenders. For a potential money borrower, it is very important to gather information first prior to applying for a loan from a moneylender.
Professionalizing the Money Lending Business
The government has taken bold steps in order to curtail the proliferation of loan sharks by introducing a fixed interest rate for all borrowing per month. The move has taken out the bad lenders out of business and only the reliable lenders have remained.
Factors to consider in choosing a moneylender
Here are some of the important things that you must consider in choosing a licensed moneylender and getting the best deal from your borrowing.
Get to know the moneylender
Since you will be dealing with a person or an institution who will be providing you money, you need to get the information about the moneylender first. Check out the person/company history. There are many online sites that list licensed moneylenders. Check out if they are listed and read the reviews. Some have testimonials from previous clients. This will ensure that you will be dealing
with a reputable lender.
Know about the fees
When you are making an inquiry, ask about the fees that you will have to pay to avoid getting surprised by the charges in the end. Read the agreement carefully and make sure that before you sign you agree to all the terms and conditions.
When you discuss what you need with the moneylender, make sure that you mention the purpose of this loan. Do not hide any information on why you are borrowing money. It will help you, moneylender, to find the best type of loan suitable for you at the
best rate.
Make a comparison
In case you still have time to spare, make sure to check about 3 to 4 options before committing to any company/person. A reliable moneylender will educate their clients on how to make the right decision. A personal loan is available at any institution since this type of loan deals with emergencies. Some of the best Money Lenders have personalized package for every client to suit their needs, it is good to check them out.
By doing a comparison, you will get the best rates. Some licensed Money Lenders also offer loans even if you have a bad credit score. If you fall into these categories, there is no fear of being rejected, as they will be able to help you if you have done your
research correctly.
Check the validity of the licenses
Licensed moneylenders are required to meet the requirements of the government in order for them to operate. This means that the borrower is assured that the lender is following the guidelines set by the government. If the money lenders continue to received complaints and this has come to the knowledge of the state, then they will lose their license. This way the borrower is guaranteed to receive good service from the lender to uphold their reputation.
Transparency of the application
As mentioned earlier, licensed moneylender received guidelines from the government on how they will extend a loan to the borrower. The lender must be able to clearly explain the conditions of the loan. The language used must be understandable and easy to understand. There should be no fine print. The lender should also be able to give the copy of the contact to the borrower.
How to Spot a Loan Shark
In spite of the warnings, loan sharks are victimizing still many people. If you are caught in a financial stress, sometimes we take the easiest and fastest route. They can be present anywhere, in the social media, in the community board, and classifieds. When all is said and done, you will be forced to pay a high-interest rate and constant bombardment of payment reminders.
Do not be a victim; here is a quick guide on how to spot a loan shark.
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The loans have off the roof interest rates
Although interest rates are normal, a sky-high interest rate arouses suspicion. Loan sharks are known for this. They will sweet talk you into agreeing with the beginning sentences like ‘I can offer you money, but you have to agree on the rate’. For a person in need, it is easy to agree. Unfortunately, you will come to know the financial sinkhole you get yourself into once you started paying.
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There is too much flexibility in the terms
Normally licensed moneylenders will ask for your documents to support the identity of the borrower and to know your real address. If the lender does not ask for any documents or did not even ask for one, chances are you are dealing with a loan shark.
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Takes any form of a document as collateral
Some lenders will ask you to surrender your passport, Bank ATM card to secure the loan. Everyone knows that when a person started asking for this, he/she is a loan shark.
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Questionable to No Contracts at all
This is one of the obvious signs that you are dealing with a loan shark. Some loan sharks have contracts though but there are fine prints and impossible provisions that will put the borrower in an unfair situation. As what we have mentioned in the early part of this article, transparency is very important.
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The loan terms are not clear
Loan sharks are the illusionists of the financial world; they will trick you into signing a contract or agreeing to a loan without clear terms. If the contacts have no repayment terms, a set maturity date, and even the required monthly payment, do not sign. You are dealing with a loan shark.
To avoid loan sharks, make sure that you only transact with a legitimate and licensed moneylender. Although you may need to have patience and considerable time in processing the loan, you are guaranteed that you are dealing with professionals.
