What do you do when a moneylender in Singapore rejects your loan application?

If you think romantic rejections are tough, you’ve probably never experienced a blatant loan refusal from a money lender in Singapore. Those can knock you off balance real quick, especially if the need for cash was urgent. Although rarely talked about, loan rejections are not uncommon. So, what would make a money lender in Singapore think you’re not worth the risk? And how do you overturn the emotional havoc that a loan rejection might wreak on your self-worth and psyche? Keep reading to find out!

  1. Do not be desperate

When your quest for a personal loan in Singapore is halted in what you think is an unfair process, you might be tempted to keep knocking on the already closed door. Don’t. The thing is, constantly badgering lenders for a loan will hurt your credit score further.

This is because multiple, small-spaced loan applications indicate desperation, which repels licensed moneylenders. Also, a combination of financial and emotional distress might lead you into the snare of predatory money lenders. Loan sharks love to exploit frustrated borrowers who’ve lowered the standards for the type of lender they’re looking for. To avoid this, simply be patient and don’t reapply before adjusting the necessary touchlines in your previous application.

  1. Study and pay attention to your rejection email or letter

The law requires all licensed moneylenders to state a specific reason for rejecting loan applications. Whether this is a poor credit score, unstable employment, or diminishing capacity to take on additional debt, you’ll know exactly what it is.

Now ideally, a rejection email deserves to be shoved in the computer bin and forgotten about completely. After all, no one needs the constant reminder that they’re not good enough, right?


Don’t let the fleeting feelings of anger and disappointment control your actions. Instead, it’s advisable that you take time to dig into the contents of the letter in order to understand the lender’s perspective. This is important because it will help shift your focus on what matters.

  1. Review your Credit Report

No doubt, your credit score greatly determines the fate of your loan application. Besides enabling you to qualify for a loan, this score also determines whether you’ll net the cheapest personal loan in Singapore. In Singapore, your credit score is calculated based on your previous loan repayment history, existing loans, and frequency of paying your credit card bills. Having a high credit score (Grade AA) reflects a stellar ability to pay back loans, while a poor score depicts the opposite. All these credit factors are compiled into one report, which is sent to any licensed moneylender you apply with.

Good thing, this report can also be sent to you upon request. Once you have it, start by verifying the accuracy of the details stated. This will help nullify the possibility of identity theft, where you’re given someone else’s report.

Luckily, you’re allowed to dispute any loan accounts that don’t belong to you. You can also challenge any registered untimely payments that you’re sure you paid on time. If everything else is correct, here’s what to do next…

  1. Focus on Rebuilding your Credit Rating

Now, if the lender’s reasons for refusing your application point towards other issues in your credit report, then you need to rebuild your rating. Start by paying off any existing balances in order to lower your debt to income ratio. Also, make sure your credit history is long enough to warrant a personal loan in Singapore. If you’ve never taken a loan before,  you’ll have a constricted history of credit maintenance and payments. This makes it difficult for lenders to decide if you’re credible or not. Other actions you can take to improve your credit score include:

  • Open small credit accounts that you can manage easily
  • Restructure and eliminate existing loans
  • Consider credit counseling
  1. Reapply Strategically

Having fine-tuned your credit report and improved everything that was mentioned in your rejection letter, you’re at a better place to qualify. In fact, you can now go for the cheapest personal loan in Singapore from a licensed moneylender.

The best strategy is to keenly study the requirements of the lender. If you can table a better offer, like let’s say ask for a less amount, offer collateral, add a loan guarantor, or opt for large monthly installments, you’ll stand a better chance.

Lastly, remember that being rejected for a personal loan in Singapore isn’t a reflection of your self-worth.