The financial market has several credit facilities. One of these is personal loans that borrowers apply for to meet their own needs. I can take a loan to solve issues like emergencies, boost my business, or for my home improvement. Most banks and lending companies have better packages that can help me maneuver my finances in a better way. Maintaining an excellent credit record will help me to have easy access to credit facilities. On the other hand, no licensed lender will be ready to transact with me when my credit status is poor due to several payments that I defaulted in the past. However, I’ve not doomed thanks to the loans for bad credit borrowers without guarantors. Continue reading this article for more tips that can assist you from drowning financially.
What Does Bad Credit with No Guarantor Entail?
Most licensed lenders in Singapore will be reluctant to lend to individuals with a bad credit history. Some of the reasons that can contribute to a bad credit record are occasional late payments for my credit card, missed payments, regular lost payments, or by defaulting altogether. Thus, when the banks or financiers scan my history, they will always find these black marks in my credit report.
This makes me a high-risk borrower, and for me to get a loan, I will be required to guarantee my repayments. That means the lender will be happy to entertain me when I provide a backup, such as a security or a guarantor. This friend or member of my family should have an excellent record and be willing to commit to stepping in when I fail to make payment. This alternative of a poor credit record facility is a relief for me when my credit record is tainted or when I don’t have a cosigner to give an undertaking on my behalf.
What are the Available Options for Bad Credit Loans without a Guarantor?
A poor credit record is not the end of the road of getting a credit facility because there are several options in the market. Most lenders in Singapore are willing to listen to me and discuss with me; however, they are also bound by their policies. I will be required to explain my situation and convince them that I will pay their money back. In normal circumstances, I need to explain the reason for borrowing as well as meet some criteria such as an annual income of SGD20, 000. The following are some of the ways on how I can improve my chances of accessing a personal loan.
Applying for Small Amounts
Having a bad credit record is an outright hindrance to a considerable loan amount because it indicates my inability to repay my debts. However, I can improve my score when I successfully apply for a debt and make an effort to repay it within the agreed time. The goal of such a credit is to confirm that I can adhere to the prescribed schedule and my capacity to honor my financial obligation. Applying for small loans and paying them back on time will make the lenders comfortable to approve a slightly bigger loan in the future. Cash advances from credit card lenders are one of these options. They are viable alternatives since they offer small financing at a somewhat lower rate than what is used by other online lenders. Furthermore, it’s a revolving credit facility that is renewed when I pay off what I have used. Paying these cash advances on time will improve my scores over time, which will help me to access a bigger loan in the future.
Restructuring the Pending Debts
A bad record indicates that I have an outstanding unsecured loan, and for that reason, I need to address the amount overdue first before I can make new applications. It includes requesting the fanciers to restructure the current interest or extend the term. I can also seek help from the credit counselors in the country who can negotiate with the lenders on my behalf. These steps will assist in recovering my credit score and motivate other lenders to approve my loan applications in the future.
Widening the Pool of Lenders
Banks may be reluctant to lend to me when my score is below standard; however, some institutions may be ready to approve my loan with the bad record and without a guarantor. They also have several options that can fit my needs. They have a different risk appetite, although their packages are slightly expensive. Sadly, some of them are not transparent to desperate customers with poor scores. However, I should understand their terms to avoid hurting myself and worsening my status by taking a debt that I can’t pay off. I should avoid firms having incredibly high rates that make it challenging to stick to the schedule. Monthly interest of 1% or below is a modest rate that enables them to collect the initial amount earlier instead of obtaining a high interest. They should also not penalize early repayment.
The Bottom Line
A poor credit record is a severe impediment to securing a credit facility from lenders. History tells the financiers that I have a terrible habit of not paying back the money I have borrowed on time. For that reason, they are reluctant to transact with me. Thus, I can only obtain a loan when I have a guarantor with an excellent record or when I provide security. To help borrowers with such a history, lenders have introduced credit facilities for borrowers with bad credit with no guarantor but at a higher rate. However, I can navigate this challenge by seeking small loans and paying them on time to improve my score and to help lenders build their confidence. I can also restructure my loans to help me resume the regular repayments, thus improving my score along the way. More so, I can make my applications through non-bank lending companies with flexible terms. Lastly, borrowing responsibly will help me to avoid any unnecessary debts. In case you need cash, you may borrow here https://www.fortunecredit.com.sg/payday-loan/.