How to Choose a Foreigner Loan in Singapore


As a foreigner in Singapore, it is possible that at some time, you will be strapped for funds and will require urgent funding.

You can come across medical emergencies or even find it challenging to manage your rent within your income. Fortunately, many loan providers help you through this situation. There are many banks and financial bodies that offer foreigner-specific loans in Singapore.

At the same time, many loan institutions can be fraudulent and unsafe. Being a foreigner, you are at a higher risk of falling into a loan scam. Many businesses try to take advantage of unsuspecting foreign customers and can even cost you money.

Even with legitimate lenders, finding an appropriate one might require a bit of research and understanding. With many different options available, finding the right lender can seem like a burden.

Below are some tips you can keep in mind while you search for a lender in Singapore.


#1 Certified lender

The first and foremost thing to look for in a lender is its legitimacy.

Make sure that the lender you are approaching has a proper license and certification as a lending body. Check the legitimacy of their website, visit their branch if needed, and make sure they have a minimum lending reputation in the market.

Verifying your lender is the most crucial aspect of your loan application as a foreigner. It will keep you safe from falling into traps.


#2 Type of Loan

Another essential thing to watch out for is the type of loan offered by the lender. Some lenders provide specific loans catered to particular requirements such as Housing loans, student loans, etc.

Particular loans might have particular incentives for foreigners. It can be wise to check the website of the lender for the specific loan products they offer and figure out if they can satisfy your requirements.


#3 Interest rate

There are many aspects to deciding the right Interest rate for your product. The first one is the type of interest offered.

Interest rates can be fixed as well as Variable. Fixed Interest rates mean that the rate of interest remains constant throughout the tenure of your loan.

Variable Interest rate means that the Interest rate applicable on your loan might change as per the change in market lending rates. In case of a variable Interest rate, the EMI amount might change through your tenure.

Variable Interest rates are generally lower than Fixed Interest rates. It is up to you to decide which kind of Interest rate is suitable for your needs and decide the lender based on the same.

The actual Interest rate applicable by the lender should also comply with the current Interest rate in the market. You need to verify with multiple lenders to find out the present market scenario and ensure that the interest is not higher than the norm.


#4 Security

Lenders offer both secured and unsecured loans. Secured loans usually ask for some immovable assets to be held as mortgage until the loan has repaid.

This can be a massive factor for your loan requirement as not every foreigner will have assets to provide a mortgage.

Look for the lenders that offer Unsecured loans so that you don’t have to keep your assets at risk. Unsecured loans, however, can be of a lower amount and higher Interest rate. Bear this in mind while you look for a lender.


#5 Maximum Amount

The maximum amount of loan that can be offered to foreigners can differ for different institutions.

Make sure that you have a good idea of the amount of loan that you require for your needs so that you can look for a lender that can cover your amount of loan needed.

Even though the bank mentions a maximum loan amount, the amount of loan approved for you will depend on your income and expenses. The amount of loan approved can be less than the maximum amount.


#6 Type of Online Lender

It is wise to consider the benefits of the different kinds of lenders offering a loan for foreigners. Generally, banks and government bodies offer lower Interest rates and higher security for your loan requirement.

However, banks can also ask for a high level of documentation and eligibility as compared to non-banking bodies. However, non-banking institutions often offer unsecured loans at a higher rate of interest.

Make sure you do proper research on the merits and demerits of both before you finalize a lender for your loan in Singapore.


#7 Eligibility

Lenders generally have an eligibility criterion they follow to make sure that your loan can be approved. It is prudent to visit the lender’s website and verify their eligibility for foreigners.

The ability for foreign nationals can depend on your type of visa, place of residence, income, etc. Making sure that you fit into the eligibility is the first step to choosing the right lender for your loan in Singapore.

Along with the eligibility, make sure to check the document section for the loan you wish to apply for. Some lenders ask for minimal documentation. The documentation for foreign nationals can be different between lenders too.


#8 Extra charges

Most loan aspirants only check the Interest rate section before applying for the loan. However, there are many more charges associated with any loan in Singapore.

These can range from the loan application fee to the documentation fee to late payment charges. Although new payment charges will not always be applicable, it is better to validate the expenses so you will be prepared in the case of any eventuality.

Also, the application and documentation fees can be quite high for foreign applicants. For this reason, it is essential to verify all the extra charges that might be applicable on your loan so that you are not surprised when the bank sends you a higher bill than expected.

Online lenders like offer foreign loans in Singapore and can be used for business or personal uses. However, you should consider a couple of things before making a decision.

Find out about your options and find out what you can afford.

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