Compare adoption loans

Adoption may be an expensive process, but you have options when you're looking to add a new member to your family.

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There’s nothing more exciting than growing your family. But the costs related to adoption can quickly add up. However, there are loans that are designed to give you access to the money you need to adopt.

How do baby and adoption loans work?

Most baby and adoption loans are generally unsecured, meaning you don’t have to provide any kind of collateral in order to qualify. Depending on your circumstances, you can typically borrow up to 4 times your monthly salary (or 10 times if your annual income is $120,000 and up) through an unsecured personal loan. The maximum you qualify for depends on factors such as the lender you choose and your credit history.

How much does adoption cost?

In Singapore, it is illegal to pay or reward birth parents for giving up their child for adoption as a means to remove profit motives from the process. Hence, the actual legal and costs of adoption are nominal – typically under S$10,000 if you wish to reimburse the biological parents for pre-natal and post-natal expenses.

If you opt to look for a child through an adoption agency, expect to pay hefty fees of between S$25,000 and S$35,000 (according to an article reported by The Straits Times in November 2015). The fees you’re quoted are dependent on factors such as gender, race and nationality of the child.

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Personal loans to consider for covering adoption costs

Name Product Interest Rate From Minimum Loan Amount Maximum Loan Amount Loan Tenure Turnaround Time
DBS Personal Loan
3.88% 

EIR: 7.56%

S$500
Up to 10x your monthly salary
1 - 5 years
Instant approval
Apply today and you could get an interest rate as low as 3.88% p.a. (EIR 7.56% p.a), plus a 1% processing fee. Loans of up to 10x your salary may be available.
POSB Personal Loan
3.88% 

EIR: 7.56%

S$500
Up to 10x your monthly salary
1 - 5 years
Instant approval
Enjoy a fast approvals service and an interest rate starting at 3.88% p.a. (EIR 7.56% p.a), plus a 1% processing fee.
HSBC Personal Loan
3.7% 

EIR: 7%

S$5,000
S$200,000
Up to 7 years
1 minute approval in principle. "Next Day" approval available for loans up to S$100,000
Get S$108 cashback plus an S$88 processing fee waiver if you apply by 12 June 2020. T&Cs apply.
Standard Chartered CashOne Personal Loan
3.88% 

EIR: 7.67%

S$1,000
Up to 4x your monthly salary, subject to a cap of S$250,000
1 - 5 years
Next working/banking day. T&C's apply
Take advantage of 50% cashback on your first month’s loan instalment, resulting in a S$199 refund on your loan account. Offer ends 30 June 2020.
Citi Quick Cash Loan
4.55% 

EIR: 8.5%

S$1,000
S$100,000
Up to 5 years
1 hour loan approval. T&C's apply
Get cash starting at 4.55% p.a. (EIR 8.5% p.a.) on a 36-month loan tenure. The interest you pay will vary depending on factors such as your credit score.
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Compare up to 4 providers

How can I pay for an adoption?

There are several different baby and adoption loans available depending on your circumstance.

How can I get a competitive loan for adoption?

The best way to get a competitive rate is to shop around and compare your options. Think about what you want to use your adoption loan and how much you need before going in so you know which points to prioritise.

  • Interest. If you’re concerned about your overall loan cost, you might want to look into interest-free adoption loans before moving on to low-interest providers. That’s because interest is often the largest contributing factor to your loan’s cost — though sometimes fees come into play.
  • Fees. Fees your lender may charge include application fees, processing fees, prepayment fees and late payment fees. Some interest-free adoption loans also come with monthly fees.
  • APR. Your loan’s APR is an expression of its interest and fees as a percentage. It’s the easiest way to compare the cost of two loans — as long as they have the same term length.
  • Eligibility criteria. In most circumstances, you need to have good credit to qualify. Some grant providers might require personal references from your employer, co-workers or friends.
  • Turnaround time. The loan processing time can vary depending on which option you choose. Personal loans are typically approved within days.
  • Loan term. Your loan term is the amount of time you have to repay your loan. A longer term gives you lower monthly repayments, but you’ll pay more in interest. Short loan terms translate into higher monthly repayments but an overall savings on interest. Make sure you consider your current financial circumstances and the size of the repayments before requesting a specific loan term.

Personal loan requirements

Eligibility for financing can vary depending on what type of loan you’re taking out and the amount you’re asking for. In general, you can expect to meet the following requirements to qualify.

  • Good credit. While not always necessary — there are bad credit financing options — you’ll need to have at least good credit to get the lowest rates.
  • Income. You’ll need to make a high enough salary to prove to your lender that you’ll be able to afford your loan.
  • Low debt-to-income ratio (DTI). Some lenders also compare your monthly income to your debt obligations when determining whether or not you can afford a loan.
  • Singapore citizen or permanent resident. Most lenders require borrowers to either be a citizen or permanent resident when they apply for any type of financing. Foreigners with valid working visa may also be eligible.
  • Age. You’ll need to be at least 21 years old to take out a loan in Singapore.

Ways to keep adoption costs down

Once you’ve browsed through the ways you can pay for an adoption, you might be thinking: how else can I save money? Adopting a child may be expensive, but you can lower the cost or make a large loan a little more manageable.

  1. Build your credit. This may seem a little odd, but remember: the better your credit, the lower your interest rates when you apply for a loan. While you’re working on saving for your adoption, see if you can improve your score to increase your chances of scoring a good interest rate.
  2. Identify a child for adoption on your own. Adoption agencies typically quote prices that are almost twice or thrice the amount you’d expect to pay if you identify a child for adoption on your own. If possible, tap into your own social network, your relatives or acquaintances instead of approaching an adoption agency. If you’re intending to take a hands-on approach for the adoption, make sure to take your time to research on all the legal process.
  3. Adjust your budget. This won’t necessarily keep adoption costs down, but it will help maintain your budget. If you can cut out things you don’t need, like changing that Spotify or Netflix subscription into a library card, you can put that extra money towards your adoption fund.

When is getting a loan for adoption a good idea?

You might want to apply for a baby and personal loan if

  • You don’t have enough time to save up. Adoption can be a long and drawn-out process. Instead of getting funds to pay for all of your adoption costs at once, you might want to consider getting financing for your immediate needs and opening a high-interest savings account for future costs.
  • You have funds coming in but you need money urgently. Look for a loan that doesn’t come with pre-payment penalties so you can have the cash you need now and pay it back as soon as your money comes in. Another alternative is a personal line of credit.

What to look out for

  • Payments you can’t afford. If you think you might have trouble repaying the borrowed money on time, avoid taking a loan in the first place.
  • High rates. Be wary of taking a loan with a high APR, which increases the overall cost of the loan.
  • Predatory lenders. Stay away from lenders that try playing to your emotions or promising low rates for bad credit without offering much evidence. Look out for companies that try to guilt you into spending more than you can afford.

Bottom line

Bringing in a new addition to the family is an exciting but expensive prospect. Compare your loan options and consider other funding opportunities so you can focus on the process of growing your family.

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