THINGS TO CONSIDER BEFORE TAKING LOAN
Before borrowing, think about other options, like government financial aid. Government agencies offer various assistance programs you may qualify for. Always remember that when you borrow from a licensed moneylender, you’re legally bound to the contract. Visit here for Singapore licensed money lender
HOW MUCH CAN YOU BORROW?
For secured loans, there is no limit on the amount you can borrow. For unsecured loans, the maximum amount varies based on your annual income and residency status:
- If you earn less than $10,000, Singapore citizens and permanent residents can borrow up to $3,000, while foreigners can borrow up to $500.
- If your income is between $10,000 and $20,000, you can borrow up to $3,000.
- If your income is above $20,000, you can borrow up to six times your monthly income.
INTEREST RATES ON LOANS
Since October 1, 2015, licensed moneylenders in Singapore can charge a maximum interest rate of 4% per month, no matter your income or whether the loan is secured or unsecured. If you miss a payment, the late interest rate is also capped at 4% per month, applied only to the overdue amount.
FEES MONEYLENDERS CAN CHARGE
Licensed moneylenders can charge only specific fees:
- A late repayment fee of up to $60 per month.
- An administrative fee of up to 10% of the loan principal.
- Legal costs ordered by the court for loan recovery.
HOW TO VERIFY A MONEYLENDER IDENTITY
Always borrow from licensed moneylenders. To confirm a lender’s license, check the official list of licensed moneylenders. Licensed moneylenders are prohibited from using abusive language, asking for your SingPass details, keeping your ID, or making you sign incomplete documents. If you encounter these practices, report the lender to the Registry of Moneylenders.
RECOGNIZING LEGAL ADVERTISEMENTS
Licensed moneylenders can only advertise through business directories, their official website, or their business premises. If you see flyers, texts, or emails, these may come from unlicensed or non-compliant moneylenders. Report such ads to the Registry.
RELYING ON ADVERTISEMENTS FOR LOANS
It’s best to clarify specific loan terms directly with the lender, rather than relying only on ads. This helps ensure you fully understand the terms before signing.
IF YOU ARE A LOAN GUARANTEE
If you’re standing as a guarantor, make sure you understand the loan terms and your obligations. The lender should provide you with a copy of the loan contract and explain the terms in a language you understand. They must not keep your ID or require any passwords.
AFTER GETTING THE LOAN
Ensure you receive the full loan amount, except for any approved administrative fee. Pay installments on time and keep all receipts and statements for proof. You should receive account statements in January and July.
REPORTING UNFAIR PRACTICES
For information on how to report unfair treatment, call the Registry at 1800-2255-529. The Registry can investigate complaints and may pursue further actions if a moneylender is in violation.
FINANCIAL DIFFICULTIES AND LOAN PAYMENT
If you’re struggling with loan repayments, the Registry cannot negotiate with the moneylender on your behalf. It’s a private matter between you and the lender.
