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The most expensive in all of Asia

‘Private education in Singapore is a bit of a nightmare for expatriates.’ A recent report by the Centre for Economics and Business Research has shown. Apparently, the total amount of tuition fees needed for an expatriate is well over $500,000. In fact, Singapore has the highest average annual tuition fees for international schools in all of Asia.

A look at the average tuition fee in 2015 of one international school based in Singapore, revealed that parents would pay $35,100 per year for senior school, $30,300 per year for preparatory and $27,300 per year for pre-preparatory. Therefore, a student who goes through any of these international schools in 2015 will have paid a total of $589,900 in tuition fees alone, from pre-prep to senior school.

 

And it’s getting more expensive

A report from Fry Group, a financial advisory firm based in Singapore further showed that more than any other product or service, private education costs have been on a faster upward trend. In fact, in the past five years, the cost of educating a student all the way through to senior school in an international school was found to have increased by 23.3%, up from $479,100. The last three years have shown a sharper increase that goes far above the general inflation level.

These sharp increases have also affected the average boarding fees in these schools. In 2010, the average boarding fees was set at $50,900 but that shot up by $10,500 in 2015 to stand at $61,400 per student.

If this trend continues, by 2020 the annual amount of fees that would be required in an international school per year, would rise by 52.3% from 2010. This is based on a forecast of a 4% annual increase in tuition fees, which would result in parents paying tuition fees of $42,900 per year for senior school, $37,600 per year for preparatory and $34,000 per year in pre-prep. Boarding fees are also expected to rise to an average of $75,200 by 2020.

 

Affordable for the chosen few

While these fees are considered relatively affordable given the high wages in Singapore, this is only true for children of lawyers, company directors and university lecturers who spend between 25% and 33% of their annuals earnings on these school fees. Medical practitioners found the fees most affordable, using only about 13.3% of their net wages to cover the fees. However, engineers and accountants were found to use more than 50% of their net earnings to cover these school fees.

These high costs of international schools in Singapore are attributed to their state-of-the-art facilities and consistent outstanding results which encourages expatriates to keep taking their children there.

Assume you want to apply for the lowest interest rate personal loan Singapore today, what would first come to mind? If you are like most household owners, you will most likely start thinking about the best lender to deal with.

 

Major Pitfall in Low Interest Loan Search

However, this is a pitfall most borrowers fall into time and again. It is high time you learnt how to extricate yourself from this trap. For starters, Singapore has an amazing array of credible lenders and there is no dearth of choices.

If you listen to most borrowers, the problem in obtaining financing lies with their approach. Most will recount how they identified a very good deal only to fail at the last minute. In short, they didn’t actually appreciate the rigors of loan eligibility and the application process.

 

Getting it Right in Personal Loan Application

The power of loan approval lies in your hands. As such, you need to get insight on how you can activate this power to get quick financing. Here are some factors to win your desired financing without much hassle:

• Understand your income: Before you start searching for financing options, look at your current income because it will be used to determine the loan amount you can get. If you already have more loans, you will have to prepare for less financing.

• Assess your current financial situation: If you already have a bad credit score and you are struggling with more loans, you need to look for a lender who will not keenly query your financial health. Most moneylenders just want a regular flow of income, but your bank will have to look at the report. As such, bypass the bank and go straight to a licensed moneylender.

• Query your eligibility: It is time to get your NRIC card ready, utility bills to prove your residency, computerized pay slips, if you are salaried, or alternatively CPF statements going back several months. If you are self-employed, you need income tax statements at least for the last two years. Foreigners require a valid employment pass, tenancy agreement, appointment letter and a bank statement.

These conditions may vary from one lender to the other in terms of the number of documents required. However, these are the main types of documentation required.

Once you have prepared all the documents, get ready for the actual search. You must have access to the internet if you want a quick loan. The lowest interest rate personal loan Singapore deals are found online hence get ready to compare tens of lenders.

In short, you have to be proactive in order to get the best loan deal. It is a task that calls for your full attention, but the end result is financial independence.

The best advice anyone can give when you are searching for a loan from moneylenders is that it pays to take time to compare lenders before committing to any particular lender. There are many moneylenders in Singapore. Many of them are licensed and registered in the Registry of Moneylenders.

It is easy to identify licensed moneylenders. You simply need to check the Registry of Moneylenders. The list of licensed moneylenders is available from the IPMO website. The challenge comes in determining which moneylender to borrow from. This is where the comparison comes in.

Ways to compare moneylenders

There are several methods you can apply to compare moneylenders. The most common methods used are listed below:

1. First hand comparison

This means contacting moneylenders and reviewing the information you get from them. You may decide to visit the moneylenders physically or contact them online. It is best to visit them as they will not give you a lot of information on their rates and other such factors on the phone or online. You will also be able to get firsthand experience of their service when you visit them. This will immediately tell you whether or not you’d like to commit to taking a loan from them.

1. Comparison websites

This is the easiest way to get information on moneylenders. These websites offer reviews and compare loan packages from different moneylenders.

• Personal experiences

If you know someone who has borrowed money from a moneylender before, you can ask him/her to recommend a lender to you. Such sources will give you an account of their personal experiences with moneylenders. This will give you the opportunity to determine which moneylenders to avoid and which to approach.

What to look at when comparing moneylenders

1. Fees and charges

Many people jump at a loan with low interest and forget that there are additional charges and fees attached to loans. Fees such as loan processing fees and insurance charges for loans will add up to the total costs of the loan. You should therefore factor this in when considering a loan package.

1. Term and conditions

It is important to consider the conditions of the loan. Find out about penalties and what happens for late payments. It is important to understand the restrictions and requirements that accompany the loan.

• Interest rates

This is usually the first thing people consider when comparing loans and moneylenders. The interest rate will affect the total amount you pay back. It is therefore important to ensure that you choose a loan with a low interest rate.

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April 15, 2015

 

Small business owners are increasingly turning to online lenders to fill their credit needs. One in five credit-seeking small businesses surveyed in 2013 applied to an online lender, a Federal Reserve Bank of New York survey reveals. And former Small Business Administration head Karen Mills (now a senior fellow at Harvard Business School) reports that online lending is the fastest-growing segment of the small-business-lending market. 

The explosion in online lending to small companies has many financiers, regulators, pundits and policymakers wondering: Why are so small business owners turning to this funding source? 

The answer is convenience.

Small business owners aren’t turning to online lenders to save money. Loans from Internet-based sources of credit are generally pricier than credit from banks and other traditional brick-and-mortar lenders. The cost of the typical online loan, it turns out, is closer to the cost of the median credit-card loan than price of a typical term loan or line of credit from a bank. One study by economists at the Federal Reserve Board of Governors calculated that the average interest rate charged on an online loan is approximately twice that on a traditional bank loan.   

Those running their own small companies aren’t moving to online lenders because their odds of getting funding are better with them than with banks. While online lenders’ loan-decision algorithms incorporate a wider range of information than most traditional small business creditors, allowing them to lend to borrowers with lesser credit scores, Internet-based lenders are actually less likely than banks to approve the loan applications submitted to them.  A 2014 survey of small business owners conducted by the Federal Reserve Bank of New York found that online lenders had loan-approval rates of 39 percent, versus 59 percent for community banks and small regional banks, and 45 percent for large regional banks.

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Related: How the Decline in Community Banks Hurts Small Business

Small business owners are turning to online lenders because the new creditors offer loan products that better fit their financing needs. These days, many small business owners do not need term loans to make major purchases, but instead require relatively small amounts of money to manage short-term cash-flow emergencies.  

Online lenders are well positioned to meet this demand. Their loans tend to be smaller in magnitude and shorter in duration than traditional bank loans, a report by consultancy Oliver Wyman and Company found. Many online lenders also offer cash advances against accounts receivable, a type of financing that is especially helpful in smoothing out lumpy cash flow.

Small business owners also are attracted by the simple and rapid application processes at web-based lenders.  In a survey of its customers, online lender OnDeck found that a significant number of its customers rejected the idea of borrowing from traditional credit sources because getting a loan from these lenders is “too difficult” and “takes too long."

Online lenders have accelerated and simplified the loan-application, decision, and funds-disbursal processes. Estimates show that applications at these creditors take as little as 1/50th the time to complete of those at traditional banks. Moreover, online lenders tend to accept or reject financing requests in hours, rather than the weeks it takes at banks. 

Most small business owners believe that time, not money, is their most precious resource.  They favor credit products that save them time, even if they cost more.  Online lending is growing because many small business owners are willing pay higher interest rates to quickly and painlessly obtain loans that precisely match their funding needs.