Throughout one’s lifetime, one has a lot of financial needs and requirements. There are a plethora of jobs they need to meet in order to fulfill important jobs that may seem necessary at any point in time in their lives. When a certain need arrives, it is necessary to look into the expenses and judge whether it is possible to cover the costs or not. In case there is some deficit in the finances, and one cannot pay for a certain requirement, he/she borrows money from a licensed and credible source. However, this money does not come for free, and neither is the transaction so black and white in nature. All transactions come with strict terms and conditions from the institution or person who lends money.
Let us look into the topic of money-lending and understand how it works. We will further look into the business of money-lending in Singapore to know where and how we can avail of these services.
Money-lending is the act of lending financial support or support in the form of property temporarily in the hope that it will be repaid in the future. Money-lending is also known as financing. In a more business sense of the word, we call it commercial loans or loans in general. Lending and borrowing are two faces of the same coin.
Now, who are the people who lend money? This is a prominent question as everything related to the loan depends on the source of the money. We call these parties lenders. Lenders are institutions or businesses that lend money that is to be paid back to them by the borrower. These lenders can be credit unions, banks, or independent financial institutions that give out money to small businesses and start-ups. Alternatively, an individual can also take a loan for his/her own needs.
One of the most important parts of money-lending is interest. The lenders profit from the interest, and that is why they take up the business in the first place. They give out money, which is to be returned with a specific interest according to the set rate of interest. This is also counted as the cost of the loan. The greater the risk of not being paid back, the more is the total interest being accumulated on loan.
Forms Of Commercial Money-Lending
There are various methods in which money is lent out. Some of these are given below.
- Capital loans
- Industrial loans
- Asset for equipment and machinery of a business
- Vendor financing
- Credit card financing
There are a few special types of loans as well. These include loans for business startups and financial aids during disaster management.
How To Choose Your Money Lender Correctly
If you are living in Singapore, you will find a variety of firms to assist you with monetary requirements. But we assure you that when it comes to money-lending, Crawfort.com is the best in the business in Singapore. Nevertheless, we will tell you how to make the right choice for yourself when you need to find a suitable money-lender.
The type of money-lender depends upon a few fixed factors. These factors are:
- Amount of loan required:
This is primarily the amount of money you need. The amount of loan required influences the kind of lender you need. If you need to loan a large sum of money, you might require a combination of commercial loans.
- Assets pledged
If you are running a business, you can pledge assets as collateral in exchange for a loan. You can get better terms than if in case your loan is unsecured.
- Kind of assets
When you are talking about a mortgage, it usually means a loan in exchange for a piece of land or a building. On the other hand, an equipment loan is a loan for financing capital expenses like equipment.
- Term of the loan
This is an important prerequisite for the loan. It is needed to come to an understanding with regard to the term of the loan. Usually, start-ups and small scale businesses require a short-term loan while buildings and land require a long-term loan.
Depending on these factors, there are various types of lenders. They are:
Organizations help you fund your financial need through donations. These do not require interest on the money lent out.
- Peer-to-peer lenders
One can borrow money from online organizations or from individuals online via third-party platforms.
- Borrowing from family and friends
This is the most common way to borrow money. However, borrowing money from someone you known comes with a loan agreement, and these agreements are more commonly called private party loans. The third-party organizations help out with the complex nature of agreements between relatives and friends.
- Borrowing from one’s own self
You can lend money to your own business as well. This works as an alternative to investments. There are contracts on a written basis that make it evident that you are the lender and put down all other clauses such as rate of interest and term of the loan.
In Singapore, you will find a number of loan providers or money-lenders who will help you out with your financial needs. However, you need to look for a licensed moneylender in Singapore. Out of all the licensed money-lenders, Crawfort is a well-reputed company that allows you to take loans from them.
Crawfort is a responsible firm that lends money legally and tailors its plans according to the customer’s needs. We introduce easy and suitable plans for our customers. We also make sure that all financial transactions are secure and 100% verified.
If ever you need to lend money for your own personal requirements, choose Crawfort overall to choose a safe and corruption-free transaction in Singapore.