Credit History Singapore 101
To say that having a good credit history in Singapore is important would be an understatement. After all, it can help you secure a home, a car, or even deal with emergencies. But when you’re just starting out, figuring out how to build your credit history in Singapore can be really confusing.
It’s tricky: How do you show that you can pay back money if no one will lend you any in the first place?
Sometimes, having a low or no credit score makes it hard to get approved or means you’ll have to pay higher interest rates. This is a problem that many people face when they’re new to dealing with credit.
But don’t worry! This guide is here to help you understand how to start from scratch and build a solid credit history in Singapore.
Here at OMY Singapore, you will discover the following:
What Is A Credit Report?
A credit report shows your credit history. It includes information on your credit accounts, payment history, outstanding debt, and other financial activities. This document is used by lenders and financial institutions to assess your creditworthiness and determine your eligibility for credit products such as loans, credit cards, and mortgages. Scores for your credit report range from 1,000 to 2,000, with higher scores meaning better creditworthiness.
In Singapore, this is maintained by Credit Bureau Singapore which is the country’s most comprehensive consumer credit bureau. It features uploads from the entire industry, spanning retail banks and major financial institutions.
Whenever you apply for a loan or credit card, providers check your credit report to determine if you are a responsible borrower who is likely to repay the money they lend you. Having a good credit report can help you get approved for credit products with better interest rates and terms. Understandably, a poor credit report can make it more difficult to get approved or result in higher interest rates and fees.
How To Get Your Credit History Singapore
Getting your credit history in Singapore is easy and can be done in just a few simple steps. Getting this document costs S$8.00, with prevailing GST, but you are entitled to one free credit report per year.
1. The easiest way to get your credit history in Singapore is to do it online.
Keep in mind that this service is not available during these hours due to system maintenance:
Daily: 5 am – 6 am
Month end: 12 am – 7 am
2. You may also get your credit history in Singapore in any 57 SingPost branches islandwide. You may find a branch near you here.
Upon receiving the application form from SingPost, Credit Bureau Singapore will process and send the credit report to you within one business day from the date of receipt of the application form, as well as all necessary supporting documents.
If you opt for the express service, your soft copy report will be sent to your email address within two hours from the time of application. This costs S$19.44.
3. Future loan applicants may also get their credit history in Singapore at the Credit Bureau office.
Address: 2 Shenton Way, #20-02, SGX Centre 1, Singapore 068804
Opening hours: Monday to Friday: 9 am – 6 pm
Hotline: 6565 6363
Upon you complete the form and your request is verified, Credit Bureau Singapore will process your request and give you a copy of your report on the spot. You may choose a hardcopy or softcopy report. If you choose to get it by mail, CBS will send it to your mailing address on the same day.
Building Your Credit History Singapore: Actionable Tips You Can Follow
Now that you know how to get your credit history in Singapore, it’s time to focus on building it. Here are some actionable tips that can help you establish a solid credit history in Singapore.
Open a bank account
One of the most crucial steps to building your credit history in Singapore is to open a bank account. This shows that you are responsible and can manage your finances. It also gives you a chance to start saving and earning interest, which can be beneficial in the long run.
Additionally, opening a bank account will allow you to establish a relationship with a financial institution and start building a history of responsible financial behaviour. Make sure to choose a bank that offers services that fit your needs and has a good reputation.
Apply for small loans or get a co-signer
It can be tough to get approved for one if you have no credit history in Singapore. Getting a co-signer can help you get started. This person should be someone who has good credit and agrees to be responsible for the loan if you are unable to pay it back.
Applying with a co-signer proves to banks that someone is willing to vouch for you, which can dramatically increase your chances of getting approved for a loan.
When applying for any type of loan as a beginner, start with a small amount that you can comfortably pay back. If you apply for a huge loan amount right away, your loan may get rejected.
Apply for a secured credit card
While there are banks that grant unsecured credit cards to individuals with no credit history, you can have a better chance of getting approved if you apply for a secured credit card. With this type of credit card, you must put down a deposit, which becomes your credit limit. This deposit acts as collateral and reduces the risk for the lender.
Using a secured credit card responsibly can help you establish a positive payment history and increase your credit score, but it’s vital to pay your balance in full and on time every month to avoid interest charges and late fees.
To build a solid credit history in Singapore, you must show banks and financial institutions that you can manage your debt responsibly. This means not overborrowing and only taking on loans and credit that will not set you back immensely. Credit providers will look at your debt-to-income ratio, which is the amount of debt you have compared to your income, to determine if you are a responsible borrower.
Aim to keep your debt-to-income ratio below 30% to show lenders that you are not overextended and can handle your debt.
Check your credit report
As you’re working to build your credit history in Singapore, it’s essential to keep an eye on your credit report to ensure that the information is accurate and up-to-date. You can do this by getting a copy of your credit report at least once a year, as mentioned earlier. Make sure to review it carefully and dispute any errors or inaccuracies immediately.
Additionally, monitoring your credit report can help you identify any potential errors. If you notice any discrepancies or fraudulent activity, report it to the Credit Bureau Singapore immediately to protect your credit score and prevent any further damage.
Seek professional credit counselling
If you’re struggling to manage your debt or establish a solid credit history in Singapore, getting help from a professional credit counsellor can be a game changer. This professional can help you create a budget, manage your debt, and provide guidance on establishing a healthy credit history.
They can also help you identify any potential issues with your credit report and provide strategies to fix them. Avoid counselling services that charge high fees or make unrealistic promises.
How Long Does It Take To Build Credit History Singapore For Beginners?
Building credit history Singapore takes time and patience, especially for beginners. It can take anywhere from six months to a year to start building a solid credit history and see a significant improvement in your credit score.
The key is to start small and focus on making timely payments and responsible financial decisions. Over time, as you establish a positive payment history and demonstrate your ability to manage credit, you will see your credit score rise and your credit history in Singapore will become stronger.
A Word From OMY
Remember, building credit is a marathon, not a sprint. It requires discipline and consistency, but the rewards of a strong credit history can be significant. With a solid credit history in Singapore, you can have access to better interest rates on loans and credit cards, and you may even be able to negotiate better terms on other financial products.
Remember that building good credit isn’t just about getting better rates and terms. It’s also about putting yourself in a better financial position overall. When you have a good credit history Singapore, you’ll enjoy better options and greater flexibility when it comes to managing your finances.
Once you’re ready to apply for a loan, our top-notch loan matching algorithm can help you. Head over to this page to get a tailored loan offer.