No matter how low Singapore mortgage rates are, it will have no meaning to you if you have bad credit. This is even when you make an income that is comparable to a professional. Having adverse personal credit can mean that most of your mortgage loan applications getting rejected, while other lender might only be willing to offer you a mortgage loan at high interest rates to offset the risk they take on you.
The thing is if you have bad credit, you will most likely already be aware of it. While you may think that nobody will find out about your personal credit history if you do not declare it to the bank, you can bet that the lender will be able to access your personal credit information easily. This means that you should always property and fully inform the lender on your personal credit issues that you think might affect your mortgage loan application. To take a look at your own personal credit record, you can obtain it from the Singapore credit bureau.
To attain a credit record that banks and financial institutions will drool over, the concept is easy. Pay all your bills promptly. But of course, if you are reading this, you probably have some credit issues that you worry can cause your Singapore mortgage loan application to fall through.
The question is: What makes up bad credit?
Because different financial institutions, banks and mortgage lenders have their own internal assessment methods to assess an individual’s credit score, there really cannot be a standard answer of what makes you an undesirable customer. Here are 3 things regarding your personal credit you should take notice of.
The first thing that you should note is whether you have been late on your payments within the last 12 months. Being late on some of your payments can be deemed acceptable sometimes. The underlining issues will be how late were those payments. If you were late for more than 30 days on your car loan, personal loan, credit card bill, etc, you can expect about 4 out of 5 lenders to turn you away. You won’t be able to get away with it with cheap excuses. You cannot expect a lender to give you a huge mortgage loan Singapore when you have demonstrated from your personal credit record that you are not very good at managing your finances.
The second credit issue that a lot of home buyers are unaware of is past settlement records. When you owe the bank $10,000 and the bank agrees to settle with you at $8,000, it does not necessarily mean that you have fully settled your loan. This will be reflected in your credit report. Yes you have settled your past personal loan with the bank and the bank will not pursue the matter further. But this is an adverse issue that will be recorded and will reflect negatively on your credit score.
The final issue concerns you being a guarantor for another person’s loan. Being a third party guarantor is a common practice in Singapore. It may be for your nephew’s study loan or your son’s car loan, etc. If you have signed up for the loan, you are also liable for it. So even though you are not the one who is paying off the monthly installments for the loan involved, late payments for the particular loan may also be reflected in your own personal credit report.
When you are already aware that you have bad credit, your best chance of securing a Singapore mortgage loan might be to approach as many banks as possible to find out which of them will approve your mortgage loan application even though you have bad credit. With so many mortgage lenders in Singapore, it can be a real hassle to go about this yourself. You can contact us at mortgage loan Singapore to quickly and more efficiently find out which are the lenders which will give you the best chance of approval.