Licensed Money Lender in SingaporeMay 24, 2016
Licensed Money Lender: Finding the ideal one for a loanJune 21, 2016
Equip yourself with the knowledge on what about legal loan Singapore and what is an illegal one so that you can be confident that everything you do with the moneylenders are under the protection of law.
If you have the time, we encourage you to read through everything in Ministry of Law’s Moneylending Guide, but read our guide if you just want to know enough to borrow with a peace of mind with a legal loan Singapore.
- The moneylender must explain all the contractual terms to you, and you can request for further explanation if you are unclear. You are also entitled to a copy of the legal loan Singapore contract.
*Tip: Always take extra note on on the repayment schedule, interest rate and other miscellaneous fees.
- The moneylender should not be able to lodge a caveat on the sales proceeds of your house. A legal loan Singapore contract does not entitle the licensed moneylender to lodge a caveat on the sales proceeds of your house.
- A moneylender can loan you any amount, as long as they are secured legal loan Singapore.
- However, there are restrictions on unsecured legal loan Singapore, and they are not allowed to work around these restrictions. So don’t trust any moneylenders who are willing to lend you money that’s outside the normal rules and regulations. Here are some of it.
- Up to $3,000, if your annual income is less than $20,000
- Up to 2 months’ income, if your annual income is $20,000 or more but less than $30,000
- Up to 4 months’ income, if your annual income is $30,000 or more but less than $120,000
- Any amount, if your annual income is $120,000 or more.
Interest rate amount
You should receive and understand the Interest Rate of the legal loan Singapore before you even take up the loan. Your money lender is mandated by law to share that piece of information.
*Tip: With the new law that kicked in on 1 October 2015, moneylenders can only charge you a maximum of 4% interest per month regardless of legal loan type or your income.
- Your interest rate should only be calculated based on the amount you owed, not the amount you borrowed.
For example, if you borrowed $100, and you have already paid $20, only the remaining $80 can be included in the calculation of the interest.
- Similarly to late interest rate, you can only be charged late interest for the amount of money instalment that you failed to repay, and not on the amount you borrowed.
For example, you borrowed $100, and you missed your first instalment of $20, you can only be charged late interest on the $20.
Types of Miscellaneous fees.
There are only 3 types of miscellaneous fees that your moneylender can charge you with a legal loan Singapore.
- Late payment charge – capped at $60 per month
- Admin charge – capped at 10% of principal of the loan
- Legal charge – ordered by the court in the case of a successful claim by the moneylender for the recovery of the loan
Bonus tips: Legal Loan Singapore!
- Never give your SingPass User ID and Password
- Never let them keep your IC
- Never sign on a blank/incomplete contract
- Never leave without a copy of the loan contract
With the above quick tips and summary information about getting a legal loan Singapore with a moneylender. You can now have a peace of mind to search for the right licensed moneylender in Singapore for your financial needs.