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Personal Loans for Foreigners in Singapore (2021)
Compare loans you could qualify for as a foreigner and learn how to apply without hassle.
What is a foreigner loan?
As the name implies, a foreigner loan is personal cash loan offered to non-citizens or permanent residents working, studying, and/or living in Singapore.
Compared to standard personal loans aimed at locals, the key difference is usually found in the eligibility criteria. While both loans help individuals tide through lean periods, foreigners are typically expected to meet a higher income requirement. Also, you may only be approved based on your salary and employment permit/pass type.
You can find out more about general requirements and restrictions lower in the article.
Personal loans you may be eligible for as a foreigner
This research is based on public information. When you apply, the provider will decide if you’re eligible based on your unique circumstances.
|Provider||Loans offered to foreigners?||Other requirements||Product details|
|HSBC||Yes, you might be eligible for an HSBC Personal Instalment Loan if you meet the eligibility requirements.|
|Standard Chartered Bank||Yes, you might be eligible for a Standard Chartered Bank personal loan if you’re a P1, P2 or Q type Singapore employment passes holder.|
|Citibank||Yes, Citibank offers personal loans to foreigners with a valid work visa.|
|OCBC ExtraCash Loan||Yes, you might be eligible for a OCBC ExtraCash loan if you’re a P1, P2 or Q type Singapore employment passes holder.|
|Bank of China $martLoan||Yes, you might be eligible for a Bank of China $martLoan if you’re a P1, P2 or Q type Singapore employment passes holder.|
Types of personal loans for foreigners
As a foreigner, you can apply for four main types of personal loans. They can be used to get you through a financial pinch or to build your credit for larger loans, especially if you plan on staying in Singapore for a long period of time.
|Unsecured personal loan||An unsecured personal loan isn’t backed by any collateral and can be used for almost any purpose. And while your interest rate will likely be fixed over the life of your loan, you may have to pay a higher interest rate than with a secured personal loan.||Up to S$100,000|
|Secured personal loan||A secured personal loan requires you to provide an asset as a guarantee — like your car or home. It protects the lender by allowing it to repossess and sell your asset to recoup its losses if you default on the loan. Because of this, it generally has lower interest rates than other types of personal loans.||Up to S$100,000|
|Payday loan||With repayment terms of two to four weeks, payday loans are typically for smaller sums of money. However, because they’re meant for borrowers with bad credit or a limited credit history, interest rates can be quite high.||Up to S$1,000|
|Instalment loan||With a set number of payments over a scheduled period of time, instalment loans can last for a few months or more. An instalment loan is usually as expensive as a payday loan, but you’ll have more time to pay it back. Best of all, some lenders even report your on-time payments so you can build your credit.||Up to S$5,000|
Education loans for foreigners
Whether it’s NUS, NTU or SMU, the opportunity to study in Singapore can open many doors. But if you can’t afford the cost of attending a university in Singapore, an international student loan may be able to help.
However, as an international student, you likely haven’t built up a credit history in Singapore. While lenders may not require you to have excellent credit, you’ll most likely be required to have a Singaporean guarantor. Your guarantor will legally sign loan papers in order to help you to obtain a loan.
Because guarantors are jointly and legally responsible for repaying the loan, they must have:
- Good to excellent credit
- Proof of Singapore citizenship or lawful permanent residency
- Proof of income
- Proof they’ve lived in Singapore for two years or more.
How can I find the best loan for my needs?
Not all loans aren’t created equal. You’ll need to do your research and compare your options before making a final decision. These factors will usually play the biggest role when you make your final loan decision.
- Interest rate. One of the most important factors to consider is the interest rate. It’s not always easy to compare them, but a loan with a low interest rate may be a bad value if its fees are too high. Likewise, a loan with a high rate and low fees could be an exceptional value.
- EIR. Don’t ignore the loan’s effective interest rate (EIR), which reflects the interest rate, fees and other charges to establish the loan. This is often the most useful tool when comparing loans.
- Loan term. While a longer loan term decreases your payment month-to-month, it does increase the amount you pay in interest over the life of your loan. A shorter term decreases the amount of interest but ups your monthly payments.
- Repayment flexibility. Many lenders allow you to choose between weekly, fortnightly, or monthly repayments. Choose one that suits your pay frequency, and also check if your lender allows for additional payments without penalty so you can pay your loan back early (if possible), which can save you considerable interest.
- Discounts and redraw facilities. Look out for offers and discounts – although remember that they might not be beneficial to your situation, despite their “special” tag. It’s better to take out a loan that suits your needs than one that’s a steal.
- Reputation. It’s easy to fall into the trap of a “too good to be true” loan. Do your research and avoid dodgy lenders as, if anything goes wrong over the course of your loan, you’ll want to be sure the lender can be contacted and provide sound assistance.
How to apply for a foreigner loan
For lawful permanent and non-permanent residents, applying for a loan is the same process as for citizens. There are no higher costs or fees, though interest rates may vary.
However, the process depends on the lender and type of loan you choose. Generally, foreigners need to submit documents proving you’re in Singapore legally and might have to apply with a guarantor if you don’t already have a credit score.
On top of that, one of the key factors lenders look out for is whether or not you intend to (or are able to) remain in Singapore for the duration of your loan term. After all, they’ll be bearing a high risk should you leave the country and default on your loan. So be prepared for the possibility that some lenders may be unwilling to work with non-residents.
If your lender offers loans to foreigners, you typically need to have:
- A foreign identification number (FIN). You’ll need to provide your FIN when you apply for a loan, which you should have after completing a visa application.
- An eligible visa. Some lenders are willing to work with foreigners with a valid visa but impose a higher minimum income requirement.
Restrictions for foreigners
Even when you find a lender that works with foreigners, you may face some restrictions. As a foreigner, you might run into the following roadblocks:
- If you don’t have a consistent credit history. You may be required to apply with a guarantor
- If you’re a foreigner who will be in Singapore for a limited time, approval for a loan may be hard
- If you’re not earning a comparatively high income, you may not be able to meet most lender’s eligibility requirements
How to get non-traditional credit references
For many foreigners, it may be possible to get a non-traditional credit check (read more on how to tell if you have poor credit). This could help you get a loan without a credit score. You will need sufficient non-traditional credit references, and your credit accounts must be free of late payments, collections or foreclosure. Non-traditional credit references can include:
- Your rental history
- A history of payments for such utility bills as gas, electric, water or cable TV
- Non-payroll-deducted medical, life, auto or renters insurance
- School tuition
You should gather at least three non-traditional credit references, each showing 12 months of on-time payments, to submit with your loan application.
Getting a loan as a foreigner involves a bit of extra paperwork and effort. But when you’re in need of money — no matter what it’s for — there are options out there for you.
Be prepared to compare your options to find the best deal. And once all is said and done, you’ll be well on your way to getting the funds you need to settle in, whether that’s for a few years or a lifetime.
Questions you still might have
What happens after I get my loan?
After you’ve completed your loan application and submitted all the necessary paperwork, your lender may take a few days to a few weeks to process your loan. If approved, your funds may be available as soon as the next day, but it usually takes longer.
You can stay on top of payments by following these tips:
- Create a budget. A budget can help you both save for monthly payments and remind you not to overspend.
- Enrol for automatic payments. With autopay, recurring payments are deducted from your bank account and electronically sent to your lender. It’s the easiest way for you to pay off your loan while avoiding late fees.
- Avoid missing payments. If you think you won’t be able to make your monthly payment, contact your lender as soon as possible. It may be willing to explore ways to help.
What if I don’t know a Singaporean that can be a guarantor for my education loan?
As a foreigner in Singapore, a guarantor is required to apply for a student loan. There are some loans available for international students without a guarantor, but these are difficult to qualify for. You may also want to consider a scholarship if you’re eligible.
Are interest rates higher for foreign nationals?
It depends on the lender. Most lenders don’t have higher interest rates, but others can increase rates by 0.5% to 1%. Interest rates on mortgages for foreigners are often higher than the average Singapore interest rates.
What about home loans, can I apply for one as a foreigner?
Yes, there are a number of banks that offer home loans to foreigners. These include UOB, OCBC, DBS, Standard Chartered, Citibank and HSBC among others. If you’re a first-time buyer and you’re an expat, non-citizen or a foreigner who meets all eligibility requirements, then it may be possible to borrow as much as 75% of a home’s purchase price.
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