Common Myths about Money Lender Singapore
What comes to your mind when you think about borrowing from a money lender Singapore?
Are moneylenders some scrappy figures lurking in alleys, just looking for chances to scam their victims with every loan they give out? That and many others are just myths; misconceptions created to mislead the many desperate persons from finding help during their times of need.
Therefore, in this post, we’ll debunk some common myths about money lenders in Singapore and show you the real truth.
6 Common Myths About Moneylenders
All Moneylenders are Loan Sharks
The most deep-seated myth in people’s minds is the belief that all moneylenders are loan sharks and operate illegally. Whereas it may be very easy to confuse the two, there lies a great deal of difference.
In Singapore, moneylenders are licensed and fall under the strict purview of the Ministry of Law. These are the above board ones with rules concerning interest rates, fees, and all other aspects of the loan business.
Moneylenders Charge Exorbitant Interest Rates
The second most believed myth is that you will be overcharged in interest rates by moneylenders, and you will drown yourself in debt. That is not true, as far as licensed money lenders are concerned.
According to the law, a licensed money lender can only charge a 4% maximum per month in one month on secured and unsecured loans.
Law restrictions also exist on the fees that a licensed moneylender can charge. These ensure borrowers will not be burdened with exorbitant fees and interest rates.
Borrowing from Moneylenders Ruins Your Credit Score
Most people think their credit score automatically gets ruined when they borrow money from money lenders. The opposite is quite true; borrowing responsibly hurts nobody’s credit; it can improve it.
Late repayments, defaults, and outstanding debts generally affect anyone’s credit score. That means you are a good borrower, and if you pay your debts on time, it will be reflected in your credit score.
Lenders Can Harass if You Can’t Pay
You may be afraid of getting harassed should you not happen to service your loan. Of course, tall tales about how loan sharks destroy properties and threatening messages are the last things anybody wants to hear. The good news is that moneylenders are never permitted to harass borrowers under the law.
They will not publicly threaten, intimidate, or shame you to collect debt from you. More often than not, a licensed moneylender would contact you professionally if you are facing financial distress and work out a way to structure your repayment amount.
Moneylenders Only Prey on Desperate Individuals
The impression is that only desperate people patronize moneylenders. People of all walks patronize licensed money lenders for medical emergencies, sudden repairs, and consolidating debts.
However, getting help from a licensed money lender Singapore is not an act of desperation but an act of controlling one’s financial dealings in the best way that suits the individual.
Loan Processing Is Lengthy and Complex
You are wrong to believe lending with licensed money lenders requires lots of paperwork and huge queues. That is usually simpler and faster.
Most licensed money lenders in Singapore have relatively simple application procedures and get loans approved to the borrower within the day or at most a couple of hours. Most lenders only require basic documents like identification, proof of income, and residence.
Conclusion
The above knowledge is an eye-opener to anyone who has held negative misconceptions about money lenders for a long time.
Therefore, the next time any of those myths comes knocking, you will know and be better placed to debunk them.
Lastly, you are in a better position to handle your money and borrowing with way more confidence