Good Debt & Bad Debt: What Do You Have?

A money lender in Singapore is a person or firm that provides small loans with high-interest rates for people who have less access in banking activities. Money lenders are usually preferred by gamblers, people who do not have a good credit history, and compulsive shoppers. Another target market for a money lender in Singapore is people who need money fast and easy, without being bothered with too many paperwork. These kinds of people are commonly found in rural areas, where they do not have access to financial institutions or are hesitant to approach them due to lack of awareness and education, and in this case, money lenders come in handy.

What do you know about Money Lender?

Money lending business is one of the most profitable businesses going in Singapore. This is because a moneylender in Singapore is permitted to charge higher rates in interest on loans with a shorter tenure, than other institutions providing similar services. A money lender in Singapore is usually required to register their business with the completed paperwork, and to set certain limits on the interest rates they charge.

The money lender in Singapore is one of the popular places to go to when people are in need of a certain amount of quick urgent cash. They are fast and easy, the perfect place compared to other financial institutions. However, that easy quick cash can stab you in the back when you fail to return the money within the promised tenure. Without the right supervision, the high-interest rates are going to choke you and the buildup will kill you eventually.

So is it wrong to borrow money in money lender? Do we avoid money lender in Singapore at all? Not exactly. Quick and easy money from money lender can be turned profitable with only one trick: borrowing money for good debts.

Most people consider all debts as bad, especially debts with money lender in Singapore. Life in debts is not something anyone look forward to. However, financial operations in life do not always go as smooth as we thought it would be. Even among the wealthiest, debts are still popular and become a constant companion for their personal and professional life. As they can afford a house in full, some of them still choose to take loans, whether from money lenders or other financial institutions. That is because they know that not all the debts are bad. There is still debts that are good.

What is considered Good Debt?

What is a good debt? A good-debt is when you take a loan and turn it into profitable leverage. For example, you call your favorite money lender in Singapore and take a S$2.4million loan for a S$2million house, with a thirty-year loan tenure, and a monthly interest rate of 1.7 – 1.9%. That means each month you need to pay S$ 7,500. Does it scare you? Seems like you’re about to dive in a pool of nightmares, doesn’t it?

On the other hand, in the brain of a property investor, a gold mine is almost in possession. A money lender in Singapore will most certainly present the above calculation to target landlords, and the competent ones will take such loans, even from a money lender in Singapore, knowing a house with a great location is worth S$ 9,000 in monthly rent, and that means a profit of S$ 1,500 every month

That pool-of-nightmares debt doesn’t sound so scary, even if they’re from a money lender, does it? In 30 years, that so darn lucky landlord will probably sell the house for S$ 3.5 million, because of course the value will have been increased highly at the time. The landlord will make S$ 1.1 million in profits from the difference of the house value alone. Yet most importantly, the landlord will have additional S$ 540,000 income from 30 years of house rental, assuming there is no vacancies.

This is what a money lender in Singapore sells, and this is how you are supposed to trick them and use their money for. You do not see the S$ 2 million debt, you foresee the S$ 1.6 million possible income.

Furthermore, a good-debt is the kind of debt that will not only pay for itself but also give you additional income. Here are some examples you can have as a reference.

Aside from properties, which is basically too much money for a loan from a money lender in Singapore, you can choose various kinds of other investments like stocks and bonds, or gold. However, this kind of investments requires additional knowledge and tactics on how to handle them. If you do, go ahead. But if you don’t, turn your loan from that money lender in Singapore into profits with these kinds of good debts:


Getting a degree in a great school is expensive indeed. However, promising career opportunities in the future will ensure that the education loan is repaid many times over. That is why most people with low and medicine degree don’t hesitate to take this loan even from a money lender in Singapore, although the cost of their education is excessive. That is because they know that 3-5 years of a doctor’s or a lawyer’s income will manage to cover it.


Businesses and investments usually require capital to start or expand. It is common to borrow money from a money lender in Singapore for businesses, because once the profits are generated, the money will be more than the loan cost. The same thing also applies to personal investments.

On the other hand, a bad debt is when you take a loan from a money lender in Singapore and use it to buy a very expensive branded smartphone, or a newly launched game console. These products are electronic devices, and their value will most certainly be decreasing over time. Your pool of nightmares is waiting if you call you money lender in Singapore for this kind of loan. They will be happy of course, but you’ll be miserable.

In Conclusion

So use the trick to borrow money from any money lender in Singapore. Understand that loans are taken from any finance institution: banks, finances, even money lender in Singapore, is not always a bad idea when you apply this trick. Use them only for good debts and turn them into profits.

Comments are closed.