There is no shortage of loan services in Singapore. In a place that readily offers personal loans through banks and credit card debts, it is always good to know the interest rates you will be dealing with. Apart from banks and credit cards, there are also licensed money lenders who do a similar job but are more accessible. These money lenders cater borrowers who don’t have a good credit history and need cash immediately for emergency purposes but often at higher interest rates.
Money lenders offer monetary access to people who are often rejected from loan applications because they earn a low income or offer no assurance of payment. In other cases, debtors may also be people who have maxed out their credit limits and bank loans. If you fall into any of these situations, you have to carefully choose the money lender Singapore interest rate that is right for you.
Is it always better to choose a low interest loan? Or is it better to go for high interest rates? Low interest sounds good but the ability to repay in a timely manner is also significant. Shorter loan tenures often come with low interest rates. If your financial ability somehow hinders you from paying up within a tight deadline, this might prove to be a problem. Sometimes, a wiser opportunity to take up is a higher interest rate over a longer repayment period to give enough time to pool resources.
To give you a better idea, written below are factors that shape money lender Singapore interest rate:
a.) Occupation and length of employment
b.) Existing assets like housing
c.) Monthly income
d.) Existing number of loans from other lenders and repayment consistency
Money lenders are only allowed to charge six different types of fees as mandated by the government. Being well-informed about regulations on lending can help you protect yourself from hidden and unlawful charges. If an applicant earns less than $30,000 a year are entitled to a ceiling on interest rates on their loans. Before committing to a loan, make sure to also ask for a complete computation of your money lender Singapore interest rate to anticipate how you can service your loan when the time comes.