If you have a bad credit score and you are living in Singapore, you might wonder whether you can get a personal loan. A personal loan can be helpful in covering unexpected expenses or consolidating high-interest debts. However, traditional banks and financial institutions typically require good credit scores and credit histories before approving personal loan applications. But is it possible to get a personal loan in Singapore with a bad credit score? The answer is yes, but it might require more effort and research on your part.
Here are some things you should know about getting a personal loan with a bad credit score in Singapore:
Explore licensed moneylenders
If you have a bad credit score, you might have a better chance of getting a personal loan from a licensed moneylender in Singapore. Licensed moneylenders are financial institutions that offer personal loans to individuals who have trouble getting credit from traditional banks. They may have more lenient requirements for credit scores and may be willing to offer you a loan with a higher interest rate. However, it’s important to be aware of the risks of borrowing from unscrupulous or unlicensed lenders who may engage in predatory lending practices. Find a full list of licensed money lenders approved by the Ministry of Law here.
Check your credit report
Before applying for a personal loan, it’s a good idea to check your credit report. Your credit report contains information about your credit history, including any outstanding debts, late payments, or defaults. It also contains your credit score, which is a number between 1 and 2,000 that reflects your creditworthiness. A credit score above 1,800 is considered excellent, while a score between 1,000 and 1,700 is considered poor. If your credit score is low, you might want to take steps to improve it before applying for a personal loan. You can also look for errors in your credit report that may be negatively affecting your credit score.
Consider a secured personal loan
If you have collateral such as a car or a property, you might be able to get a secured personal loan. A secured personal loan is a loan that is backed by collateral, which reduces the risk for the lender. If you default on the loan, the lender can seize the collateral to recover their losses. Because of the reduced risk, lenders might be more willing to offer you a secured personal loan even with a bad credit score.
Look for a co-signer
If you have a family member or a friend with a good credit score, you might be able to get a personal loan by having them co-sign the loan. A co-signer is someone who agrees to take responsibility for the loan if you are unable to make the payments. Having a co-signer with good credit can increase your chances of getting a personal loan and might also result in a lower interest rate.
What is the lowest credit score for personal loan?
The minimum credit score requirement for a personal loan in Singapore varies by lender. Most banks and financial institutions require a credit score of at least 1300 to be eligible for a personal loan. However, some lenders might have more lenient requirements and offer personal loans to individuals with credit scores as low as 1000. It’s important to check with the lender about their credit score requirements before applying for a personal loan.
In conclusion, getting a personal loan in Singapore with a bad credit score is possible, but it might require more effort and research on your part. You can explore good, flexible licensed moneylenders, check your credit report, consider a secured personal loan, or look for a co-signer to increase your chances of getting approved for a personal loan. To check if you may be eligible for a loan with us, submit an application form for free here.
