Getting a loan with poor credit history is a little difficult—but not impossible. So, cheer up because financial help is not out of your reach if your credit history so far is less than impressive.

And, guess what, approaching a legal money lender Singapore is not the only option available to you. It is one of many options available. Which one you should choose depends on what type of loan you need and your personal preference.

So, let’s take a look at the type of loans available to you even when your credit history is below par.  

Credit card loan

You can take a loan on your credit card. Whether this is possible or not will depend on how bad your credit history is. If your credit score is just below par, you might be able to get a loan from your credit card company. However, remember the rate of interest will be higher than usual. So think carefully before you opt for this option because anyway credit card loan interest rates are perhaps the highest among all personal loans.

Secured loan

This is another viable option, bad credit history or not. As the name suggests, in this you get a loan against something. How much loan depends on your financial situation and the value of the thing against which you are taking the loan.

Payday loan

This option is best for meeting a short-term financial emergency—and not a very big one at that. You mightn’t even need your credit score for this loan, so it is a certainly a good option at specific times for everyone with bad credit. However, you need to keep a few things in mind:

• Payday loans are small loans which you get your next paycheck. So they are not suited for meeting a long-term financial problem. How much loan you can get depends, obviously, on your salary and current financial situation. However, it is best you to not take more than what you need.
• A payday loan is for a very short period, usually no longer than more than 2 weeks. Usually, the lender takes the amount owed directly from your next paycheck. Therefore, you should only borrow that much which you can comfortably pay your next salary.
• Payday loan has an extremely high-interest rate. That is why you shouldn’t make a habit of relying on them almost every month or unnecessarily defer full payment because then you will end up paying a lot more than the actual due amount.

Personal loan from a money lender

Another option available to people with bad credit is money lenders. Keep in mind that you should always approach a licensed money lender. Stay away from loan sharks, which not only charge exorbitant interest rate but also are often resort to ugly practices, especially if you are late in repaying the loan. While the maximum interest rate a money lender who’s licensed can charge is capped, often lenders offer borrowers a loan at an interest rate lower than maximum. Therefore, don’t forget to shop around, because this will give you a good chance to get a good deal.