Money lender is a person or a group of people who lend money to a person or a group of people. This process is called as lending a loan.

Money lenders are of two types. Licensed and non licensed. Licensed money lenders are preferable choice for taking loans as they adopt the working pattern similar to the financial institutions.

The licensed money lenders are granted license by the Ministry of Law and are verified too. They prefer to recover loan amount by formal mails and legal notices. They avoid using any harsh recovery methods.

The money lenders who are not licensed by the government of Singapore are called as loan sharks. They adopt more hash methods of loan recovery. They give loans to the people who have a comparatively bad credit history.

There are two types of loans granted by the Credit Excel Money Lender Singapore

Secured Loans

These are the most popular and preferred type of loan. In this type of loan, an asset is pledged against the loan amount applied for. It is to be noted that the amount of the pledged asset should be more than the amount of the loan. There is a proper pre set format that needs to be followed in the entire process. Upon signing the contract paper you are obligating yourself that in case you fail to repay the loan amount, then your pledged asset shall be seized by the Moneylender Singapore. The biggest advantage of applying for a secured loan is that there are possibilities of getting a higher amount. This limit is set as four times to the loan amount by the banks in Singapore. There is an exception to this rule if some sort of collateral is offered. In case if the value of the pledged asset depreciated below the loan amount pending, then the money lender can demand the extra amount to cover the loan amount. Another thing is that the secured loans come with lower interest rates.

Unsecured Loans

In this type of loan there are no assets pledged all together. The loan is given on the applicant’s assurance that they will repay it on time. If in case of default, the lender is free to approach the court for taking the loan amount back. If the applicant still fails or declare himself unable to repay the loan amount, the court can order to sell out his properties and recover money. This is the biggest reason that unsecured loans carry high rates of interest. It is always recommended to borrow the amount of loan which you will be able to repay to the money lender.

These were the two types of loans given to the general public by the money lenders. Many people prefer to go for secure loan system. The reason behind this is that they have a legal agreement between the lender and applicant. The lender can no way use any violence or unethical ways to recover the loan amount.