Singapore’s economy has been growing over the years and standard of living has increased as well. In a research done by the Ministry of Manpower, there is an estimated number of 201,000 female domestic workers in Singapore. This means that one in every five Singapore households hire a domestic helper.
Foreigners choose to work in Singapore because of more opportunities and better work prospects. The salary they receive in Singapore is also much higher than that in their own country. However, even with a better salary, it might get financially tough for foreigners and domestic helpers while they are working in Singapore. They might be short of cash.
What Are Domestic Helper Loans?
If you are a foreign domestic helper in Singapore and is facing financial troubles, don’t worry. There are licensed moneylenders that can help you. Whether you need to send more money back to your home country or that you need extra cash for financial emergencies, licensed moneylenders in Singapore are here to hear you out. Domestic helper loans are loans that cater specially to domestic helpers. These loans can help you with your finances and they have low interest rates and are of easy approval.
Domestic helper loans provide:
- Low interest rates
- Available for foreigners
- Flexible loan tenures
- Fast and easy approval
- Friendly consultants
Nonetheless, one should always be responsible when managing their finances and that includes getting a loan. If you are a domestic helper who needs cash and is planning to get a loan, there are some important points you need to consider before settling on the lending institution that is the most suitable.
10 Things To Check If Your Moneylender Is Licensed And Right For You
1. Moneylender must be fully licensed
Loans sharks are illegal moneylenders in Singapore. They are not licensed with the government and are known to charge very high interest rates. They often resort to unethical methods when collecting money such as splashing paint on their clients’ doors. They may even use threats. In view of this, one needs to be very careful to check if the lending institution is actually legal and fully licensed. Legal money lenders will only charge interest rates that are within the law, and they will handle the applicants very professionally. Here’s a list of licensed moneylenders in Singapore.
2. Moneylender to have good customer reviews
One of the best ways of getting an accurate assessment of any institution is by getting feedback from previous customers. When in need of money, borrowers might be rash in their decision making. Before one decides to access a domestic helper loan from any lender, he or she should take time to carefully go through reviews given by former or current clients. These reviews can be found online or even through word of mouth.
Other customers will give the general experience that they had with the particular lender. This information will save a potential applicant plenty of time because he or she will quickly get an overall independent analysis of the lending institution. It will also help the applicant to avoid having a bad experience with an institution that is unsuitable.
3. Moneylender should be flexible
An applicant should be able to negotiate with the lending institution on the terms of repayment as well as the interest rates. In Singapore, most licensed moneylenders who offer domestic helper loans tend to be flexible with their terms of repayment. However, not all lending companies have the same flexibility. Some companies will be more flexible than others. The applicant should carefully compare the terms and conditions of different lending institutions and finally select the company that is most suitable. Some may be more understanding and offer longer loan tenures which may make loan repayment easier for some. The applicant should choose a company that is able to give him or her a repayment schedule that is convenient and easy to abide by.
4. Moneylender should have a physical address
One should be very careful about lending companies that do not have any physical address. If there is no office where the institution is located, then this is a sign that it could be an unlicensed money lender (loan sharks).
This does not mean that there are no online loan application services. Licensed moneylenders in Singapore will usually have a physical shop as well as an online website. Online application for domestic helper loans can be done via the website. However, after the approval, the applicant should go to the physical offices of the institution to get a proper contract. It is a huge risk for a domestic helper to get this loan from a lender that has no physical office. He or she will be unable to do any tracing or follow-up in cases where the lending company flouts the law.
5. Moneylender should give financial advice
A money lending company should be willing to give good financial advice when giving credit facilities. An applicant should choose a company where he or she can get advice on a domestic helper loan. The company should give guidance on issues such as the suitable amount to borrow and the most suitable repayment terms based on the applicant’s budget. If a company is only willing to give loans without giving advice, the applicant may end up making several costly mistakes that could result in huge losses. Never take a loan amount that is too large and too difficult to repay.
6. Moneylender should provide clear documentation
Lack of documents can cause serious problems when it comes to getting a domestic helper loan. An applicant should determine to avoid all lending companies that are not keen on compiling and maintaining proper documents. A credible lending company will have everything in writing and will issue the applicant with a copy of the same documents that are retained in their offices. This creates confidence for both parties, and in case of any incident, the guide will be the documents that were signed by both parties.
7. Moneylender should have no hidden terms and conditions
Sometimes an applicant may be offered a domestic helper loan which may look straightforward. However, when the repayments begin, the applicant may get a rude shock when they are suddenly hit with hidden charges and conditions. Examples are extra interest rates, processing fees or hidden fees that were not mentioned before. Unfortunately, the victim who will end up suffering losses in this case is the applicant. With this in mind, the applicant should read carefully through the contract given, especially the very small print. In this way, any terms and conditions included in the contract that had not been discussed earlier can be brought to light before the contract is signed. If there are any doubts when signing the contract, do clarify with the loan advisors immediately.
8. Financial advisors should be responsive and patient
The finer details of the domestic helper loan may not be very clear to the applicant. Therefore, it is important to get a lending company that is known to have patient and responsive staff. A company that does not take time to explain the details of the contract creates a situation where the applicant may misunderstand some facts. This may cause several problems later on when certain scenarios arise. It is usually difficult for many applicants to understand the legal terms used in the documents drafted by the lending company. It is important for the applicant to choose a company that makes all these terms clear.
9. Moneylender should be law abiding
It is very important for a lending company to abide by the law. An applicant should do his or her investigation to find out if the lending company is following the existing laws on money lending. It will be possible to get this information from other customers who have previously taken credit facilities from the institution. Lending companies who are not law abiding tend to charge higher interest rates than what is allowed legally, and they may not follow any other legal guidelines that are laid down. The legal framework is usually put in place to protect both the borrower and the lender. Therefore, an applicant should stay away from lending companies that are not keen on following the rule of law.
10. Moneylender should be fair
Money lending companies are in business for the main aim of making money. However, the applicant should engage a company which gives a loan contract that has a tone of fairness in it. Some companies draft contracts that are more favourable for the lending company than for the borrower. The applicant should look for an institution that also gives the borrower an equal advantage in the contract. It is important for the applicant to agree with the benefits of the domestic helper loan that will be enjoyed by each party. Not all lending companies have fair terms, and the applicant needs to make an extra effort to assess the conditions given.
Domestic helper loans are made to help foreigners in Singapore who are going through financial crisis. Things may get tough especially when they are so far away from home. If you are a domestic helper in need of money, do a thorough research and find the right licensed moneylender that can help you. 1AP Capital offers a wide variety of loans and is a licensed moneylender in Singapore with the Ministry of Law. We have a physical store where there are friendly consultants to help you. Fill up our online application form and our consultants will get back to you within 24 hours!