You might have to take a personal loan at some point. You could be looking to pay off other loans, require money for an emergency, have your home remodeled, meet your child’s education expenses, or have a wedding coming up.
You can borrow money in two ways – from banks or private moneylenders. While banks offer some benefits, those are far lesser than private lenders. And that is why most people prefer taking personal loans from licensed lenders like A1 Credit, which lets you borrow money at low-interest rates along with same-day approval.
Read more if you want to know how the process works and what you should know before taking a loan from a private lender.
Reasons Behind People Preferring Moneylenders
- No worrying about credit score – with money lenders, you don’t have to worry about things like credit score, credit history, or your ability to return the money after a specified period. Once you complete some paperwork, the company gives you the money you need.
- Payback in installments – You can repay the amount in installments rather than lump-sum, which is highly convenient for many people.
- No early repayment fees – Another factor that makes people choose them over banks is the option for early repayment, where no costs are involved in returning the loan before a specified period.
- Quick approval time – One of the main benefits of borrowing from lenders is the short loan approval time, which can be as low as an hour with many.
- Low interest and the high loan amount – Some companies allow you to borrow personal loans six times your monthly salary, provide manageable repayment terms from six years to 12 months, and have a monthly interest rate that varies between 1% to 4%.
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How Does the Process Work?
Here is how the process of taking a loan from a lender works;
- Apply for the amount – In the first step, you should submit your application on the company’s official website. Some companies also offer the option of applying through the phone or walk-ins.
- Visit the office – After the professional evaluates your application, they will ask you to visit their office, where the loan officer will offer you the amount while explaining the related terms and conditions.
- Sign the agreement – You should read the repayment terms and related terms and conditions carefully before proceeding and signing a contract if you find them acceptable.
- Get the money – The company will instantly provide you with the required cash after the contract signing.
What Are The Eligibility Requirements?
Most firms provide loans to people above 18 years of age with a minimum monthly income of 1,500 SGD for locals and 2,000 SGD for foreigners.
What Documents Required For The Loan
Although the specific documents required may vary from one company to another, most will ask you to provide an:
- Identity card or NRIC
- Proof of residence (tenancy agreement or a utility bill)
- Proof of employment (three months’ recent payslip and Certificate of Employment)
- SingPass (without which you cannot log into websites like HBD, CPF, and IRAS)
How to Know if a Firm is Licensed?
The best way of identifying a licensed lender is by checking the list released by the Registry of Moneylenders, managed by the Ministry of Law in Singapore. The law permits lenders to advertise only through business directories, official websites, and ads placed within the office’s premises.
If someone contacts you outside these three channels, you should avoid carrying out transactions or even approaching them.