There are times in life when you are in need of money, as there are various kinds of situations in one’s life where there is an emergency and you desperately need a particular amount of money. So, what do you generally do? You might go for your cash reserves stored in your bank account. You might have reserved this money just for this kind of situations or rather emergencies. But, let us just take it that your cash reserves have also exhausted (this is a totally possible situation and happens with most of us), then what will you do? From where you will bring money in such a short duration? Well, in this kind of situation people mostly opt for loans. But what if, due to some reasons, you cannot take loans from any bank or any financial institution, then what to do? At times like these, there are individuals or group of individuals who will help you and lend you the required amount of money at high rates of interest. These people are known as money lenders. If you live in Singapore, and you face such a terrible situation, then you should search for the top licensed money lenders in Singapore.
Money lenders and the Financial Institutions
For knowing the top licensed money lenders in Singapore, first, you need to know what money lending is and what is the job of a money lender? Well, from the term it is quite clear, money lending is the activity of lending cash or even supplying goods and services which is to be repaid at a higher rate of interest in a short duration. And a money lender is a person or a group of individuals who perform the money lending process. But you might be wondering, then what is the difference between a money lender and a bank or any other financial institution, as both of them lend money and take it back at a specific rate of interest. Well, the financial institutions are licensed money lenders that are certified by the Law, or in other words the government. A money lender may or may not be licensed, and the difference between them and the financial institutions is that the money lenders charge extremely high rates of interest and the loans offered are small and personal. However, the abnormally high rates of interest are most of the times justified, as there is a huge amount of risk involved, and to curb that, these money lenders charge exorbitant rates of interest. The most common examples of financial institutions that lend money are banks, insurance agencies, credit unions, and building societies.
The Process of Money lending
As mentioned, when it comes to lending money from money lenders, the rates of interest are extremely high, as compared to the normal rates of interest provided by the licensed financial institutions like banks or insurance agencies. These money lenders play an important and also an active role in the society by lending money to those people who are in dire need of money but, for some reasons, cannot take loans from the financial institutions. For those people, the top licensed money lenders in Singapore will definitely lend money in the best possible rates of interest from the money lenders.
The people who borrow loans from money lenders are usually the ones who have less privilege to banking activities like the underbanked or maybe unbanked. These borrowers sometimes might not even have a decent or good credit history. A credit history is basically the record of the repayment of debts the borrower is responsible for. There is also another kind of people who would want to borrow money from a money lender such as a person who is a compulsive shopper or even a person who gambles a lot. These types of people are the ones who mostly get into debts and as their reasons are such, they can’t borrow money from financial institutions, so they contact the money lenders.
There are numerous nations that have laws for money lenders in place. Like they are required to register, and also set specific limits on the rates of interest which might be charged. The licensed money lenders mainly deal with the small amount of loans. Though some money lenders might be eager to lend larger sums of money to specific clients. The loans given by the money lenders could be secured or unsecured. For the loans that are secured, there is a particular collateral form that will permit the money lenders to seize the collateral (like jewellery or maybe real estate papers) only if there is a situation where you fail to or are unable to repay the loan.
The licensed money lenders mostly manage the borrower dealings individually. These money lenders check the borrower’s record of credit history as well as their income and on the basis of that, the rates of interest are decided. As the rates of interest vary on various factors and also the amount of the loan, whether it is a small loan or a big one, and on the basis of their personal judgement. And because of this reason, any kind of generalised statements about the terms and rates of interests and also about the money lenders are quite difficult to mention beforehand. Due to the reason that there are significant amounts of risk involved with the business of borrowing loans from money lenders, the money lenders charge quite high rates of interest.
The best part of borrowing money from money lenders is that if you have nowhere to go, no way to borrow the required amount of money in a short period of time, then there are money lenders that will always help you in times like these. Most of the times, some banks and even some financial institutions do not allow you to borrow loans, no matter what kind of emergency you are facing. And the reason behind this can be that you have a bad credit history or some other similar reason. So, to help you out, the top licensed money lenders in Singapore will always help you.