Questions to ask when Hiring a Singapore SME Loan Broker

Questions to ask when Hiring a Singapore SME Loan Broker – Most business owners wonder, why is there a need for a SME Business Loan Broker when you can approach the banks and get the loans yourself. Or why is there the need to have loan broker when the banks themselves are so aggressive calling you especially if you have your main bank accounts with one of the 3 banks in Singapore?

Getting bank loans in Singapore is not that easy as you think with most businesses actually experiencing difficulties due to the following reasons:

  1. Bank business financials due to constant loss making
  2. Bank bank statement details
  3. Bad personal credit scores

This are just some of the few more common issues that business owners face when they are looking to get a bank loan.

But one thing that most people do not realize is, having working capital loans available during times of needs can either help you to survive or expand in a period of good growth or crisis.


So before you decide why you should get a SME Loan Broker in Singapore, here are some of the Questions to ask when Hiring a Singapore SME Loan Broker:

Most business owners will definitely ask the Loan Broker, why should you hire a corporate bank loan broker in Singapore?

  1. You as a business owner is busy running the sales, marketing or operations of the business and do no have time to go around finding the best rates and also coordinating with the bankers to get all the paper work done
  2. You tried getting the bank loan from one of the banks or financial institution before and you got rejected and have no idea why

This are the common reason people will most likely hire a corporate bank loan broker.


 

But when you want to hire a business loan broker in Singapore, one of the main reason and question you should ask the loan broker is:

  • What is the cost that you will incur when you hire them to assist you with your potential loan application¬†

The reason this matters is that some brokers may charge a percentage at success, which means you do not have to pay any amount down for the work that they do for you but when you receive the funds, you will have to incur this consultation fee for their help. Or the other option that other brokers will provide is a small initiation fee and subsequently a fixed amount on success. Or a upfront full consultancy fee.

Depending on your risk appetite, most business owners will prefer zero down payment and this is also one of the most common working system for most Singapore Business Bank Loan Brokers.

One thing to make sure before you sign the engagement form or contract with the broker is to take note if there are clauses that states that whether successful or unsuccessful you still have to pay the brokers, you might want to be careful with that.

Also note that some scammers may want you to pay a deposit before you can get the loan! This is not true!

  • How confident are they in getting your case approved with the banks and what are the expected rates and fees

Some of this brokers have very extensive connections with different banks and other brokers and because of the volume of business, they are able to get good rates and also fast response times from the bankers.

An honest Loan broker in Singapore will definitely be upfront and honest with you after reviewing your documents on how likely that your case can be approved and also guide you to help you improve your case. Not all cases are the same and if the bank loan broker is very confident upfront even when you don’t have strong financials or bank balances, be wary.

For working capital loans, interest rates can be anywhere from 6.5% to 8.5% (effective interest rate)

For bank or financial institution term loans, interest rates can be anyware from 6.5% to 12.88%.

Bank fees on average are around 2%, which can be negotiated.



The question here is, should you hire a Singapore corporate bank loan broker?

The following reasons is what we think you should consider when hiring one:

  1. You prefer someone negotiating rates and fees for you and ensuring you are getting the best the banks or financial institutions can offer you
  2. Getting a quicker response because of the urgency the broker will place on your case
  3. Getting a better understanding of how bank loans work and what to watch out for when you are planning to get loans, especially in the case where you are a first timer.

 


 

Avant Consulting Pte Ltd is a Singapore based Corporate Bank Loan Broker and Consulting firm that provides professional Loan Brokering Services and Advisory work for Small and Medium Enterprises.

We work closely with business from all walks of life and industry to provide the best rates and fees for our clients and work with them to choose the best options for their goals of business expansion or cash flow usages.

We also work closely with SMEs to ensure that they get the fastest response when they need the funds urgently.

Contact our Singapore Bank Financing Loan Brokers to get your financing done now!

Thank you for reading our article on “Questions to ask when Hiring a Singapore SME Loan Broker”.