It can be difficult for young entrepreneurs to start or to maintain their own business. Entrepreneurs know that if you want to make money, then you need money. Without enough budget, a business can end in an instant. However, getting funds to start or to finance business can prove to be a difficult task. Choosing whether to loan from a bank or a moneylender will depend on your business plan.
If you have a small to medium-sized business, then moneylenders can be a great option to finance that. Moneylenders can be more lenient and can grant your loan faster than a bank. The document requirements of some moneylenders may be less stringent than those of banks. You just need to find the right moneylender, and to have the required documents.
Are you looking for a business loan in Singapore? If you are, then you should first read some tips that can help you get a business loan in 2019.
WHY DO YOU NEED A BUSINESS LOAN?
Before you make a business loan, you should decide why you need the money. Sometimes, moneylenders will ask you on why you need to make a business loan. Are you using it to expand or to improve your business? Will you use it to pay a debt or cover for losses?
HOW MUCH DO YOU NEED?
Once you have decided on why you need the loan, you need to answer the question on how much will you need. If you borrow money that is more than what you need, then you might end up with a debt that may become a burden to pay.
FINDING THE RIGHT MONEYLENDER
- Find a licensed moneylender
It is important that you should only transact with moneylenders who are licensed. Unlike loan sharks and unlicensed moneylenders, licensed moneylenders have passed the requirements set by the Ministry of Law in Singapore. You can find the list of registered moneylenders on the website of the Ministry of Law in Singapore.
- Compare the terms and conditions of different moneylenders
If this is your first time in getting a business loan, then it might be better for you to compare different moneylenders. You should find a licensed moneylender who can give you more flexibility in payments. You can make a list of licensed moneylenders that you can assess. You can compare their interest rates, their terms, and conditions.
- Read customer reviews
The moneylender should be able to interact professionally with customers. If the moneylender has a website, then look for customer reviews that can tell you about the moneylender. You should also note that moneylenders are not allowed to advertise through calls or texts. You should not respond to their call or texts, as they may be unlicensed.
WHAT YOU NEED TO KNOW
- Proper paperwork
The different documents will vary from one moneylender to another. Also, the requirements of the documents may be different depending on if you are a sole proprietorship, a partnership, or a corporation.
Here are some documents that moneylenders may require from you:
- An Accomplished and Signed Application Form from your moneylender
- Past Bank Statements
- Identification Cards
- Business Registration
- Business Profile Report
- Financial Statement
You have to take note that moneylenders may require you to be a Singaporean Citizen or a Permanent Resident. You have to make sure that all of your documents are updated and complete. This will make the loaning process faster for you.
- Credit History
Most moneylenders will look at your credit history and credit score as a basis on whether you are a good or bad borrower. If you have a long history of credit, then it might be favorable for you. However, you should make sure that you have an excellent credit score. If you have incurred a debt, then you must be able to make sure that you were able to pay it promptly.
Remember that some moneylenders will offer a non-collateral agreement, which puts them at high risk. Thus, you have to show that you are a reliable borrower who can pay off his or her debts promptly.
If you have a credit history and you want to know your credit score, then you can check it on the website of the Credit Bureau of Singapore.
Before you sign any contract, you should make sure that you understand the terms and conditions. According to the Ministry of Law in Singapore, your moneylender should explain the terms and conditions of the contract properly. Also, you should not sign it if it is incomplete.
- Status of your loan
It is important to note that your moneylender may not grant your loan right away. Like in banks and other institutions, your loan proposal will be subjected to scrutiny. You can ask your moneylender on how you will know about the status of your loan. Remember that moneylenders are not allowed to call or to text you. However, there are some moneylenders who can grant your loan within twenty-four hours. Your choice of moneylender will depend on how urgently you need the money.
As stated before, making a business loan is a life-changing decision. It can determine the future of your business. Managing a loan properly can become a good debt. However, if managed improperly, then it can become a burden. This is why you need to find the right moneylender who can satisfy your financial need.
If you are having a difficult time looking for a moneylender, then visit this website:https://www.loanadvisor.sg. This website has an updated list of the top moneylenders in Singapore. The right one could be just near you!