Critical questions you need to ask before you apply for a payday loan

Posted onCategoriesLoan

It could be that season when you’ve run out of cash and an emergency happens. There is a temptation that you may not want to do some thorough shopping for the payday loan lender with flexible terms and one whose cost is not exploitative.  Don’t fall into this temptation; you may end up paying the bitter price.

Here are some questions you need to ask before you take out a payday loan.

Is the lender licensed?

Before you begin any kind of business in Singapore, the local authorities must license you. This is a sure proof that the lender terms and conditions have been verified and that they follow the laid down rules and regulations of the industry. Companies that are not licensed locally may charge exorbitantly and even violate other state regulations and this could turn costly to you. Mark you; if you get a loan from a non-licensed lender, the state cannot protect you in case you fall prey to some unscrupulous lenders- be careful.

Get to know the lender’s location

The physical address of the payday loan Singapore company is a sure proof of the authenticity of the company and not just another street con. Get the official’s business card that has the lender’s details including address. Don’t be in a rush to fill up those application forms- walk to the office if it’s within your vicinity and fill up the form from there. Most dubious companies operate remotely and therefore don’t have offices locally-that could mean the local authorities do not license them. It’s easy for these to flout on the regulations and get away with it.

Confirm if the company is really a lender

It could surprise you that some of the companies that present themselves, as lenders are in reality not at all. Their work could be to collect relevant information and sell it to other interested organizations at a fee. In fact, they act as intermediaries who sell your information to the highest bidder. Keep away from brokers and deal with a direct lender.

How much are you getting after all?

Above everything, the amount you get after the transaction is what is important. Let the lender give you details of all the costs, the interest, penalties in case of late repayment and the repayment schedule that would tell you whether you can afford to repay the loan or not.

Any loan that you get from a lending company must be paid back- whether emergency or an ordinary one. Your repayment ability is the determinant of the amount you qualify. You must be careful on the lender you are going for. High charges of the loan, when processing and the interest could lead to a high level of exposure, which can, in turn, affect your repayment.