All You Need to Know Before Applying for a Loan from a Moneylender in Singapore
When applying for a loan, it would be best to research the application requirements beforehand to facilitate the approval process. If you need emergency funds, a licensed money lender in Singapore can help with your request.
Such lenders aim to make the borrowing process as easy as possible. Moreover, they cater to customers from different financial backgrounds, offering customized plans according to one’s unique requirement.
Also, Read This: Three Key Risks with P2p Loans
Eligibility for Loan
Before you apply for a loan, it would be best to know how much you can borrow. If you want to apply for a secured loan, you can obtain a loan for any amount. However, if you are applying for an unsecured loan, the loan amount depends on your annual income.
For Singapore Citizens and PR
- If your yearly income is less than $20,000, you can borrow up to $3,000.
- If your yearly income is at least $20,000, you can borrow six times your monthly income.
- If your yearly income is less than $10,000, you can borrow up to $500.
- If your yearly income is a minimum of $10,000 and less than $20,000, you can borrow up to $3,000.
- If your yearly income is a minimum of $20,000, you can borrow six times your monthly income.
Documents Required for Loan Approval
In Singapore, both citizens and foreigners can apply for loans. However, the type of documents required by both parties will differ.
It is best to prepare the documents beforehand, to ensure a speedy loan approval.
If you are a citizen or have a PR, you will require the below primary documents for loan approval:
- Personal identity documents – a copy of NRIC.
- Proof of employment and income – this could be your salary slips for a minimum of 3 months.
- Proof of residence – if you stay in a rented property, you can bring your tenancy agreement, utility bills, or letter addressed to you.
You may also require a credit report, depending on the lender you choose to work with. Most money lenders in Singapore do not check a borrower’s credit history for personal loans. They instead check your annual income to determine whether you can repay the loan borrowed.
If you are a foreigner working in Singapore, you will require the below primary documents for loan approval:
- Personal Identification document – Passport.
- Work permit, S Pass/ E Pass.
- Proof of residence – this could be a tenancy agreement or utility bills.
- Minimum of 3 months salary slips.
- Recent bank statement showing salary credits.
Apart from these documents, all borrowers need to be aware of their SingPass user ID and password. For citizens and individuals with PR, the credentials are needed to log into CPF, HDB, and IRAS websites. As a foreigner, you will need the credentials to log in to the IRAS website.
Verify If the Money Lender is Licensed
When choosing a money lender in Singapore, you must verify if they are licensed to offer their services. You can do so by visiting the Ministry of Law’s website. If you do not find the lender registered on this list, it would be safe to assume they are an unlicensed lender you should stay from.
A licensed lender cannot reach out to you over text messages or social media with loan offers. This advertising tactic is not allowed by the government. However, unlicensed lenders can reach out to you over call, text, or social media offering loans above the permitted limit, asking for personal details or money. These can be potential scammers. It is therefore advisable not to interact with them.
Also, lenders are required to complete a face-to-face verification of the borrower at a designated place of business before approving the loan. So, if a lender offers to complete the loan process, from start to end, online, they are not a licensed lender.
Other Factors to Consider
Even if the lender is licensed, you should be mindful of the below behaviors:
- Retaining your personal documents such as NRIC, passport, driving license, or work permit.
- Pressurizing you to sign an incomplete loan contract.
- Asking for your SingPass credentials.
- Offering to lend amount exceeding your annual income limits
- Offering to skip the face-to-face verification process.
When choosing to borrow from a money lender in Singapore, some of the primary documents you require are personal identification, proof of residence, and employment. When customizing a repayment loan plan, most lenders consider your annual income; thus, they ask for your recent payslips rather than a credit report. When applying for a loan, always perform thorough verification of the lender’s license and credentials to ensure safe and secure dealing.
Likewise, you can read the following posts also:
- 6 Things to Avoid While Applying for a Home Loan &
- How to Get an Auto Loan with Bad Credit?