Fancy more advertisements by Private Licenced MoneyLender on Newspaper offer personal loan?
Personal Loan - Fast approval
- Loan Up to 4X your salary
- Lowest Rate
- Flexible repayment
Sound Good?
Why I say they are operating worse than a loanshark?
Usually Licenced MoneyLender charge $30 admin fee just to check your CPF contribution and Credit Bureau Record. To Be Competitive, a few will waive it.
You can call to ask to enquire or request for any loan amount.
Usually you won't get anything more than $1K. (Lack of Capital or minimise their risk?)
Lowest Interest? Flexible repayment? 1.5 interest per month? 18% interest p.a? MY FOOT.
Despite all the fancy advertisement on paper...
Most Private Moneylender will insist on weekly repayment at 5.7% interest. Which mean 22.8% per month which is more than illegal moneylender. So who is the loanshark? Weekly repayment allows the moneylender to earn more and get some money back to roll. I doubt they have millions in capital and more demands than what they have. If you borrowed 1k and you have to pay $57 interest per week and thus weekly repayment is $307
Once your loan is approved, you have to pay 2% of the loan amount as loan approving fee. Ha! Do they have so many bank admin staffs to check and verify the loan? So for a 1k loan, you only receive $950 after admin charge and loan approving fee.
Comparing these Private Licensed MoneyLender with the Illegal one for a $1k loan
Private Licensed moneylender: Disbursed amount: $950 and weekly repayment of $307.
Overall you forfeit $278 for 1 month
Illegal moneylender: Disbursed amount: $800(They took your interest first) and weeklly repayment of $200 + $10(collector fee).
Overall you forfeit $240 for 1 month
By the way, who want to or can repay a loan weekly on monthly wage? Unless you can a taxi driver or security guard or doing odd job with daily pay.
Some Licenced Money Lender DO offer MONTHLY repayment at usually 15% interest PER MONTH( PER MONTH NOT PER ANNUM)
For a $1k loan for a repayment period of 6mth: you will be charged $900 for interest WHICH IS ALMOST the principle sum! the repayment amount is $317 per month.
For $1k loan for a repayment period of 1 year: you will be charge $1800 for interest which is amount double and that is 180% interest per annum. Credit Card charge only 24% p.a There is 7.5x more.
Late payment is even Harsher.
Bank change up to $60
Illegal loanshark extend 1 week of repayment which mean 20% more
Licensed Moneylender can charge up to 30% of the loan amount. (This is amazing)
The law stated that moneylender interest is supposed to cap at 18% per annum?
Have they exploit the Loophole? This is no wonder more and more such moneylending firm pop up.
I wish the Law can deal with such evil means of business.
Why people still go to them?
1. Rejected by Bank due to bad credit or too many loans
2. Need Cash Fast
3. Low Income
4. Lack of Knowledge. (Bank do offer Personal Loan for those earning 20k p.a)
5. STUPID
For how they handle payment default I do not know. Anyhow here are what moneylender do:
Banks will send lawyer letter
Illegal Moneylender splash paint, lock your house or vandalise or simply write graffiti.
Private Licenced MoneyLender??? no Clue yet...
How fast can you get the money from Private Money Lender. Earliest is usually 6-8hr or next day. Craps to them saying approval within 2hrs or instant cash!!! You may have to wait for 1 week sometime.
Feel free to comment and come back for more updates. Will be going on site to check. Hahaha!
My advice: If you really want such fast cash and NO family member or single friend can help... Don't waste the $30 admin fee. ( Once money put in... hard to change your mind)
