When a person or an organization creates a business to lend money at interest to another person or to an organization, called Moneylender & this business is called Money Lending business. (Generally, Moneylenders are individuals).
Here you might get confused between bank & Moneylender. But these are two different entities even though both have the same functions. You can find people good at money lending in ang mo kio easily.
There are some Pros & Cons of borrowing money from Moneylenders:
- Less Documentation on borrowing money.
- Even a person with less credit score or no credit score can borrow money.
- Moneylenders generally accept Gold, Jewelry, or land as security. (But it can differ from Moneylender to Moneylender).
- The process of recovery is rigid & strict on non-repayment of loans.
- The rate of interest is decided by the Moneylender & is normally very high than some Bank & other financial institutions.
- There are many Moneylenders in the market who are not licensed.
These are signs that you need a moneylender:
Less Credit Score – If you need a Home loan, personal loan, business loan, or any type of loan but you are not getting your loan due to less credit score or no credit score, then you must visit a moneylender. Because moneylenders focus on your future property which you are developing, not on your past credit score.
Security – If you need a loan but either you don’t have land & building for security or you have land & building for security but you don’t want to collateral that land & building, then you must contact a moneylender. Because they accept Gold or any other Jewelry as security.
No Documented Income – There are many people whose income is not documented but need loans. For example,farmers, small businessmen, cash salaried people & many more. If these people apply for a loan in banks & financial institutions, then there is a very high chance that it might get rejected. But moneylenders lend these people monies at interest.
No additional charges – There are many charges deducted before approving a loan in banks such as processing fees, legal fees, technical fees, CERSAI charges (in case of a Home loan) & many more. They deduct 3 to 4 percent of your loan amount in charges. But there is no extra charge other than interest like banks & financial institutions. Therefore, if you want to avoid these charges then you must visit moneylenders.
Low-income – If your income is not high then you might face difficulties getting a loan from banks & other financial institutions. That’s why it is advised for low-income people that you must contact a moneylender, you would get an easy loan.
To summarize, if you are struggling for loans in banks & financial institutions due to any reason & still you are not getting your required amount of loan then there are many listed moneylenders whom you can meet & get your loan in an easy way.