Personal Loans

Hacks to Get Great Rate When Applying for a Personal Loan

When applying for a personal loan, the interest rate is one of the greatest factors that determine where to take out the loan. Read on to find out more on how to get the best rates!

Whether you need a personal loan for emergencies, to renovate your home, for a wedding, or many other reasons, to get a personal loan in Singapore, they consist of many different factors. There are many different interest rates to choose and consider from, you have to maintain a good credit score rating, and you would have to set a goal of how the repayments will work.

Interest Rates

calculator and five stacks of coins

Personal Loan Interest Rate

A personal loan interest rate is a percentage of interest that is associated with the principal amount. The lower the interest rate, the lower your monthly payment will be.

Annual Personal Interest Rate (APR)

The annual personal interest rate (APR) combines the personal loan interest rate and any other fees that may be associated with the loan. If there are no other extra fees, the APR will be equivalent to the personal loan interest rate, however, this is rarely the case.

Effective Interest Rate (EIR)

An effective interest rate (EIR) calculates how the interest rate would look after taking into account all the compounded periods and their effects on the interest amount. The more often the compounding period is, the higher the interest rate will be. Thus, it is important to consider both the APR and EIR as they may differ significantly based on the compounding periods.

Maintaining an Excellent Credit Score

Credit scores assess the likelihood of an individual being able to repay the debts and the probability of risk. Credit scores range from 1,000 to 2,000, 1,000 with the highest risk of not being able to repay debts, and 2,000 with a low chance. Many things account toward getting a good credit score such as credit history, negligence of duty, and how you spend your money.

credit score rankings table

Usage Pattern and Available Credit

Credit scores take into account how much of the credit available an individual uses per term. It is said by many advisors that you should maintain a certain level/ratio of how much you use your credit. To improve your credit score, they suggest limiting your credit usage by up to 30% each term.

Current Applications and Past Applications

If you have quite a few credit applications within a short period of time of also applying for a loan, they may be wary that you are overreaching yourself. This can bring more uncertainty and may bring down your credit.

This also refers to the number of applications you’ve applied for in the past. If there are too many applications, it can lower your credit score as it seems like you are trying to incur more debt.

Negligence of Duty

yellow sticky note that says pay debt in red market

When applying for a loan, it is crucial that you do not have any late payments on other accounts. This brings down your credibility and trustworthiness. The presence of other loans or debts alone can also risk a higher interest rate.

Credit History

Just as companies ask for relevant experience in applying for a new job, lenders also ask for a credit history. This includes 12 months of history of when payments such as bill payments were made to calculate for your score.

To maintain your credit score and to fix a bad credit score, there are many actions you can take. This includes avoiding applying for many credit cards, paying off bills and debts on time, and to check your available credit. To find out more on the importance of a good credit score, click here.

Where to Get Loans

a man stacking three stacks of coins

Usually, banks have higher interest rates and more requirements compared to other Licensed Money Lenders. Be wary of loan sharks and check to see if the institution you are working with is registered under a Licensed Money Lender through the Ministry of Law.

Compromise and Negotiate

Banks still want to make earnings by giving out loans. Before you confirm the loan agreement, try to ask for an interest revised down and ask for a revision. In this case, most lenders will give in and reduce the interest even by a little bit. Even though it may seem small in percentage numbers, once they are applied to your loan amount, they will add up pretty quickly.

Loan Calculators

To calculate the exact monthly interest or payment you have to pay, there are many resources online to make the calculations. These calculators and resources also have comparisons you can make between different loan providers.


Lendela is an online platform one can use to find the best loan provider for your needs by submitting one application. They will send your application to multiple lenders and help you pinpoint the best provider.


Consider this if you are unable to obtain a personal loan from a bank
  • Eligibility
    • S$1,200 per month
    • Max. Loan Amount
      • 6x monthly salary
      • Min. Loan Amount
        • S$1,000
        • Processing Fee
          • Varies
          • Approval Time
            • 1 day


            Almost all banks in Singapore have a personal loan product available. To learn more details about the comparisons of different banks, check out this link . Each bank also provides a loan calculator (e.g. DBS loan calculator) for borrowers to get a sense of their timeline, budget for each month, and how their instalments would work. It also displays the interest rates, potential service fees and other charges.

            HSBC Personal Loan

            Consider this if you require a large, long-term personal loan
            • Eligibility
              • S$30,000 of annual income
              • Max. Loan Amount
                • 4x monthly salary for income S$30,000 to S$120,000; 8x monthly salary for income > S$120,000; S$200,000 Maximum Loan Size (2x monthly salary for foreigners)
                • Min. Loan Amount
                  • S$10,000
                  • Processing Fee
                    • S$0
                    • Approval Time
                      • 1 minute approval, receive cash in one business day
                      HSBC Personal Loan offers loans for up to 7 years with a low interest rate of 3.2% and an effective interest rate from 6%. This is beneficial for borrowers who want to maintain a low monthly payment for a longer period of time. The minimum loan amount one can qualify for is S$5,000. The maximum amount one can qualify for is 4X the monthly salary for those with incomes S$30,000 to S$120,000, and 8X the monthly salary for incomes more than S$120,000. There is an early repayment fee of 2.5% and a late fee of S$75.

                      Standard Chartered CashOne

                      Consider this if you are interested in large personal loans with low rates, or personal loans with the lowest interest rates for low-income borrowers
                      • Eligibility
                        • S$30,000 of annual income
                        • Max. Loan Amount
                          • 2x monthly salary for annual income below S$30,000; 4x monthly salary for annual income > S$30,000; 8x monthly income for annual income above S$120,000 (up to S$250,000)
                          • Min. Loan Amount
                            • S$1,000
                            • Processing Fee
                              • S$199 for 1st year, S$50 for subsequent years (waived for borrowers who make repayments on time)
                              • Approval Time
                                • 15 minutes
                                Standard Chartered CashOne Personal Loan offers interest rates starting from 3.48% for qualified borrowers with an effective interest rate from 6.95% p.a.. They also charge the lowest interest rate for those who earn less than S$30,000 a year. Singaporeans aged 21 to 65 with a minimum annual income of at least S$20,000 are eligible to apply for a Standard Chartered CashOne Personal Loan. The minimum loan amount one could be eligible for is S$1,000. Once applied, the applicants will receive the loan within one business day. There is an annual fee of S$199 during the first year adn S$50 for the subsequent years, that are waived if the payments are on-time for the entire year.

                                Other Licensed Money Lenders

                                Aside from banks, Singapore also has a list of Licensed Money Lenders you can borrow from. They may be more lenient in terms of lowering the interest rates by negotiating and other terms and conditions. Remember to always double check your sources when going through other sources than a bank!


                                To get a personal loan with the best interest, it is important to maintain a good credit score, and to know how much you really need. This way, you can plan for the necessary preparations to negotiate and compromise with the money lenders for a better interest rate.

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                                Fiona Ling

                                Fiona is a full-stack marketer working in the digital sphere for more than six years.
                                A self-proclaimed foodie and bargain hunter, she wants to bring the best deals and value to the community around the world. When not working on her pet projects, Fiona can be found sipping a coffee while reading a paperbacks or watching mystery thrillers on Netflix and Disney+.

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