How to Borrow Wisely from a Moneylender

Anyone can get into financial difficulties. When that happens, it is good if you know one or two fast cash Singapore moneylenders.  Getting a quick loan from a moneylender is more straightforward than doing it from other sources. Moneylenders have less stringent conditions than banks and credit unions making them ideal for anyone who needs money fast.  However, moneylenders have sometimes been given a bad name mainly due to the fact that some borrowers do not borrow wisely and do not understand what they are getting into.

Questions to ask before borrowing

  • Are you borrowing to repay another loan?

Borrowing a cash loan to repay another is a sign that you in a serious debt crisis. The wisest thing would be to get financial advice from a debt manager. Moneylenders are obliged by law to do due diligence before lending you money. If the moneylender finds out you have a debt problem he probably will not lend you any money.

  • How many options do you have?

Just like any other product, cash loans come at different prices. Get quotes from different personal loan Singapore money lenders. So that you can get the most attractive rates

  • How much do you need?

You can get any amount of money if the loan is secured.  If you are looking for an unsecured amount personal loan Singapore moneylenders are obliged by law to consider your personal income to assess your repayment capability.

  • A limit of $3,000 if your income is less than $20,000 annually
  • A limit of 2 months’ income equivalent of your income if it is between $20,000 and 30,000 annually
  • A limit of 4 months’ income equivalent of your income if it is between $30,000 and $120,000
  • Any amount if your annual income is over $120,000
  • What interest rates will you be charged?

Interest rates are legally capped at 4% per month for all loans regardless if the loan is secured or unsecured. Unlike before, your income does not matter either. Late payment attracts the same rate of 4% monthly.

  • Are there other fees?

A moneylender is only permitted to charge fees other than the interest when;

  • Late interest of 4% per month when you are late for your repayment
  • Late Fee of $60 if you pay your repayment late
  • There are legal costs around the recovery of the loan.

A loan from a moneylender is easy to apply but it is always wise to know what you are getting into before signing the contract.

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