Getting approved for a cash loan in Singapore while you are unemployed can be a difficult task. However, sometimes you just need that extra cash in order to get your life moving again. Maybe that personal loan is meant for a business venture, or to survive the month while looking for work.
In this article, we will help you with getting a personal loan for an unemployed Singaporean. Before that, however, we will talk first about the factors that lenders consider when approving loans.
The things that lenders consider when approving loan applications
When applying for a personal loan, there are some factors that lenders consider before they approve or reject your application. First, they look at your sources and your annual income. The amount you earn is one of the biggest factors in which lenders decide the amount that they want to loan to you. Next is your credit score. The higher it is, the more willing lenders will be in approving your application. Lastly, your debt to income ratio will be used by lenders to determine if you can manage to pay back the loan that you will get from them when your other obligations to bills, loans, and other commitments are considered.
That is why your personal income is a very important component of getting your loan application approved. Not having a job will make it harder for you to obtain a loan when you need one. However, there are some things that will allow you to take out a loan even when unemployed. Here are a few loans that all unemployed Singaporeans can take to cover their financial needs even if they do not have a stable job.
Co-maker loanA co-maker will negate the point of you not having a source of income since the co-maker will also be responsible for the payment of the loan in the event you’re unable to repay the loan amount. However, you need to have a friend or family that is willing to take responsibility for your loans before you can take advantage of the loan. You will also need to have a good reputation since no one will be willing to take upon your request to be a co-maker if you are known as someone who always fails to pay their loans.
Collateral loanIf you cannot get a co-maker, or unwilling to trouble your friends and family with the difficulties in your finances, getting a collateral loan is a good choice. However, this requires you to have an item or property that has equity that can be used as collateral. This can include your home, real estate properties, vehicles, jewelry, stocks and bonds, etc. Be careful using such items as collateral, since failure or default on the loan will mean losing the collateral to the bank or lending institution where you got the loan.
How to properly get a loan while unemployed
Have other sources of income
Being unemployed doesn’t mean that you don’t have a source of income. This is because if you don’t have a source of income, it will be hard to find a lender that’s willing to lend you unless you have a co-maker or collateral to guarantee your loan.
It is vital that you begin looking for other sources of income at the earliest opportunity. This way, you can show to the lenders that you still have ways of generating a monthly income even without a full-time job, making it easier for you to get a loan. There are a few ways to earn even without a full-time job. For example, you can start doing freelance or part-time work, create your own stream of passive income, or even apply for unemployment benefits in the interim.
Take care of your credit score
When unemployed, it is important that you take care of your credit score. Refrain from doing things that reduce it, such as not paying your bills on time. Two of the biggest factors when getting a loan is your income and credit score.
A lower score coupled with the lack of a job will make it harder for you to get a loan from a reputable money lender, forcing you to take loans from predatory and shady loan providers. Protect your credit score, and keep your debt to income ratio to acceptable levels and avoid unnecessary charges on your credit cards if possible as some credit cards can charge high interest rates for late repayments.
Also, keep track of your repayment schedule. A bill regularly paid on time increases your score, while a bill left unpaid decreases it.
Select a loan provider best suited for your preferences
There are certain things to consider when choosing a lender to get your personal loan from. First, are they providing the loan products that fit your credit score? Some loan companies or licensed moneylenders only provide loans to people with a high score.
Meanwhile, there are some personal loans that you can get even if your score is bad. Next, you should consider the amount offered by the loan provider. The amount should be sufficient to cover all your financial needs without requiring you to take up another loan from a different source. Finally, what are the interest rates of the loan products? Is it reasonable or an exorbitant one?
These are things that one must keep an eye on in order to have your applications approved. Without regularly checking and ensuring that your bills are paid on time and your financial health is stable, you will not be able to obtain a loan easily.
Are you having trouble getting your loans approved?
Fortune Credit, one of Singapore’s best licensed moneylender here to help you. With our fast loan approvals, easy online applications, and quick release of loan money, cash loans have never been so easy with Fortune Credit.
Click here to visit our website for more information and other offers. Alternatively, you can also contact us via telephone at 6777 1887.