SMEs in Singapore have for long been experiencing difficulties in securing financial assistance to get off the ground. Most of them resort to lenders who levy heavy interests on them that make it hard for SMEs to repay. When it comes to borrowing, SMEs should consider making responsible borrowing to avoid falling into financial traps. There are several factors that SMEs must consider before considering SME business loans in Singapore. These include:
Lenders charge different rates on their loans. Borrowers must consider interest rates to understand the amount they are required to pay. Lenders often have flexible and fixed interest rates. Flexible interest rate changes over the entire repayment period while fixed interest rate remains constant. Both types of interest rates come with their advantages and disadvantages.
Credit requirements determine the ease at which a business can acquire a loan. Some lenders have put in place strict guidelines that must be met before a business is granted a loan. A lender with simple guidelines has lower chances of turning down business. Therefore, it is advisable that all SMEs read through lending guidelines of a lender before applying for a loan. Some even resort to charging high-interest rates on those who’ve defaulted on a loan in the past or even decline them altogether. Additionally, new lenders in the industry typically require detailed financial conditions and a well-prepared business plan for one to qualify for an SME loan.
Monthly payments vary depending on the type of interest rate plan that one chooses. A flexible interest rate will mean a business must pay varying amounts at the end of each month. It means the business must be capable of meeting varying monthly interest rates. A fixed interest rate plan can give business time to plan for future monthly payments since it already knows the amount to pay.
The total amount of loan required is critical even before applying for one. The figure helps entrepreneurs to determine whether the funding is sufficient and that they can pay back without straining too much. Alongside the total amount, it is also advisable to consider the attached interest amount and related processing fees. A high amount will be of no use when one cannot afford to pay.
SME business loan terms refer to the duration of payment and monthly payment amounts. Most lenders in Singapore require good business credit, sound business plan, large asset base and industry experience. Some offer up to five-year payment period with the lowest monthly interest rate.
Read through their terms and conditions
Business must thoroughly read through the terms and conditions of a lender. It helps them to understand whether there are penalties for defaults and late payments. It also aids them to detect whether the lender has hidden fees. Borrowers can read the terms by visiting the website of the company.
Finding a loan should never be an overwhelming task for SMEs in Singapore. While there are several lenders, SMEs must consider various factors including loan terms, monthly payments, interest rates, lending conditions and amount.
The money game can be quite stressful especially when you don’t have a backup plan. It is survival of the fittest. This means that you have to play your cards right for you to survive. Your main source of income is not always going to be enough to cover all your expenses. Which is why you have to be wise enough to include a plan that will sustain your needs. For instance, if you are still a student, you may want to try the banks for a suitable loan. This is never an old idea for anyone interested in making it safely to the other side.
According to the law
Whether you are in a financial mess of some sort, it is always good to go according to the law. Failure to which will see you get caught up in bad books with the law. For example, if you plan on involving a money lender into your plans, ensure that their deals are legal. Many have considered this option but haven’t had such a happy ending. Following up all the requirements will save you a lifetime of running away from the long arm of the law.
Look in all the right places
If you wish to get money into your accounts even before the official pay date, you have to look in all the right places. Money is everywhere for our asking, but we just haven’t discovered the art of searching. All the sources we need are made available to us to make our work easier. The online platform has become the most trusted means of getting loans. This is mostly because the lenders available don’t ask for too much. Instead, they only ask for something that is within our reach.
Licensed to loan
A credible and trustworthy money lender is the one that has all the credible licenses. Proper documentation should add more weight even to the ongoing deal that is yet to take off. The reason for a license is to show compliance with all the regulations and statutes that govern the money lending institution. Before signing a piece of paper, be sure to ask for a certificate or document that bears the license number. This way, you will save yourself from the clutching jaws of con artists. CreditMaster Singapore Moneylender is one company to provide you such loan.
The quickest way out
Emergencies just can’t wait till you fix some pending issues first. You need to have a source of help there and then. Failure to which will see your situation move from bad to worse. Emergencies to do with money are the worst especially when you have no means of getting access to it. It is a different case when you have it all sorted out. If you don’t, you are better off when you know all the fast and most affordable money lenders.
Use your loans wisely
Now that the money has found its way into your account be extremely cautious. The excitement of having your loan go through can be quite overwhelming. Which is why you should have a definite plan on how exactly you can make it effective.
Purchasing a home is one difficult task that one has to do, more so in cases where you do not have enough money to pay for the house. But luckily with increased technology, there has been an establishment of lending specialists who make the task of buying a house easily by giving out mortgage loans that can enable you to buy the dream home that you have always wished for. Some of the loaning specialties are banks, Sacco credit saving, and FHA 203k. However, over time the HFA loan specialists have been preferred because of the excellent deals that they have for their mortgage loans. In this article, we give you the benefits if securing a home through the FHA mortgage loan.
One of the benefits of seeking for FHA mortgage loans is that it allows its customers to use the gift funds that they have to pay for the down payment and also the closing costs. For instance you lack the given percentage of down payment that they gave you but you have relatives or friends who have the amount and want to gift you, the 203K lenders will allow for that.
Smaller down payment
The biggest advantage of FHA mortgage loans is that they allow their clients to give a down payment of up to 3.5% of the value of the home that you wish to buy. This is totally the opposite of most banks that ask for a down payment of up to 20% of the value of the house after you have discussed with the seller. This kind of loan will help the individual who is not in a position to raise the down payment.
Credit history is not important
If you are the individual who has a credit history that is blemished, you will not need to worry about that when you are going to request for an FHA mortgage. This is because the FHA loan lenders can accommodate such histories. However, if you have several foreclosures, late payments, legal judgments and tax liens, then you will not qualify for the mortgage loan so easily. You will only be granted the loan if your case is an isolated one because the loan specialist will try to make some exceptions.
The fourth benefit of FHA loans is that they are assumable. For instance, if you want to sell your house before completing the mortgage loan then you will be able to do so. The buyer of your home will assume the mortgage loan with all the loan requirements that were outlined to you.