Taking a loan has become a part of modern-day financial management. You might need a loan for any purpose like a wedding, a medical emergency or to meet some business needs. Taking a legal loan in Singapore requires certain formalities and documentation. That’s why before applying for a loan in Singapore, you must make sure that you have all the paperwork ready.
This will not only help you get through the process of a loan approval faster but will also make the whole experience a lot smoother. However, first things first, before applying for a legal loan in Singapore, you must also know your borrowing limit which means your capacity to pay loan.
To make it easier for you, here is a curated list of must-have documents that you should have ready before you get ready for the process of applying for a legal loan in Singapore, which is a loan procured from a trustworthy and licensed lender and not from the infamous loan sharks. Having these documents ready with you would help you procure a loan faster and without any hassles.
Income certificate/ Payslips
The first and foremost requirement for a legal loan in Singapore from a bank or a financial institution is to have your income proof ready. This could be a certificate of income or your latest monthly payslips. These income documents are essential to know your capacity to pay loan and you will be deemed qualified for a legal loan in Singapore based on your income certificate only.
Banks and financial institutions need these documents to ascertain whether and how much money they can lend you without risking a default. Here it is also important to remember that if there is any lender who offers you a loan without any income proof then beware of them as they are highly likely to be a loan shark.
Before you apply for a legal loan in Singapore, you must ensure that your bank statement is healthy. By that, we mean that there should be enough savings to help you pay loan EMIs. If your bank statement shows no funds or very low savings then you would either get a lower loan amount or the bank might even reject your loan application to avoid risking default.
Copy of identity proof
Any genuine bank or financial institution will need proof of identity from anyone seeking a legal loan in Singapore. You can share a copy of your NRIC or the Employment pass card. Depending on the loan amount and type, the bank might also ask you for employment details, EPF statement, or other such documentation.
For a business loan, you would be needed to furnish audit reports, Memorandum and Articles of Association (MAA), etc. In some cases, the lender can also seek proof of occupancy such as a tenancy agreement.
For those seeking a loan to buy a property, it is necessary to furnish the property’s papers such as the Certificate of Entitlement (COE) or ownership to ensure that the property is actually owned by the applicant.
The banks offering a property legal loan in Singapore are also going to ask you for other supporting documents such as the tenancy agreement if you are looking to rent the place. Similarly, for a car loan, you would need to furnish documents such as car registration and proof of ownership such as the invoice from the car dealership and the transfer letter. Other documents such as the driving license and insurance papers should also be kept ready.
For an employee legal loan in Singapore, you would be required to furnish the NRIC/Employment pass card or EPF statement. You might also need employment proof such as the employment contract, job offer letter, and details of salary and other benefits such as bonuses.