Loans for Bad Credit in the Philippines: How to Check your Credit Score

If you have been wondering why your loan and credit card applications are being rejected left and right, then one reason may be because of a bad credit. It can be difficult to find online loans for bad credit but it’s not that difficult to fix it.

What is bad credit?

A bad credit means that you have a history of failing to pay your loans or bills on time. It can also mean that you have too many loans under your name for the last 6 months.

It’s normal, forgivable even, to miss a due date once or twice or to have many loans.

But if it becomes a habit, it will have a negative impact on your credit history. When you apply for a loan, the lending institution submits your information to the Credit Information Corporation, the Philippine's public credit registry and repository of credit information. Check the list of companies who submit and access credit information from CIC here.

What happens if I have bad credit?

If you have bad credit, it will reflect on your credit history and lower your credit score.

All unpaid loans and bills that have accumulated over time will appear on your credit history and will be visible to banks, government agencies and other financial institutions.

If you have a low credit score, it will be more difficult for you to apply for loans or credit cards with competitive rates. Some lenders may even reject you outright.

Having bad credit can also affect your chances of getting stable employment and an insurance policy.

What is an online loan for bad credit?

An online loan for bad credit is a type of loan available for those with no or negative credit history.

Bad credit loans in the Philippines are available online through lending apps or websites. These apps usually require your mobile number, email address and 1 valid ID. Some apps would also ask for your social media accounts.

How can I get an online loan if I have bad credit?

Although your chances are slim, having bad credit does not stop you from getting a new loan. There are private online lenders in the Philippines that offer cash loans if you find yourself needing one.

It’s very easy to apply for a loan from an online lending app. You just need to download the app on your phone, sign up for an account, indicate the loan amount that you need, upload documents as required, then wait to get approved!

You will get your loan in as fast as five minutes!

Benefits of Online Loans for Bad Credit in the Philippines

1. 100% online

In applying for an online loan for bad credit, you don’t need to waste time and energy lining up outside the whole day!

Simply download the app or go to their website and apply for a loan anywhere, anytime! What’s more, your loan amount will be disbursed through the app or to your own bank account/e-wallet.

2. Easy to apply for

When it comes to online loans for bad credit, you don’t have to show up at a bank or office somewhere to apply.

Everything is 100% online from application to disbursement!. If you have any concerns, you can simply contact their customer service through email, phone or social media!

3. Requires little to no documents

Another reason why online lending apps are so popular is that they don’t require too many supporting documents.

All you need to provide is your personal information, employment information, contact details and reference if needed. You can even apply for an online loan with just 1 valid ID!

4. Get your loan as quickly as possible

Online lending apps have all the means to disburse your loan as quickly as possible. You can even get your amount within minutes of being approved!

Since it’s online, you can get your loan within the app itself or through your bank account, e-wallet or chosen payment center.

5. The loan can be used for any purpose

Loans from online lending apps can be used for whatever purpose! You can use it for medical bills, home repairs, groceries, utilities, school fees, gadgets or even to pay off other debt!

Another good thing about online loans for bad credit is that they generally don’t require collateral. That means you don’t have to give up your property or anything valuable just to secure a loan.

6. They don’t check your credit history

Online loans are a good way to improve your credit history if you have bad credit. They won’t ask for a copy of your credit history. They won’t see if you have unpaid loans and bills.

However, if you have a bad credit, the interest rate of your loan may be higher than the average and the loan terms can also be shorter.

An online loan can also help you build your credit history. To test the waters, you can apply for a loan for as little as ₱500!

Best personal online loan for bad credit

A bad credit score or history should not stop you from getting a loan. Nowadays, there are lots of options out there for online loans for bad credit. Here, we are going to list down some options and help you choose which online lender for bad credit to choose.

Unfortunately, unscrupulous lenders can take advantage by offering high interest rates (5-6) or compromising your bank account (sangla ATM). Loan sharks are worse: these lenders will not hesitate to give you very tight loan terms or harass you once you miss a payment date.

Family & friends

In times of financial need, you can rely on family members and friends for support. Most of the time they won’t hesitate to give you a loan with no interest. They might not even ask for repayment – you can use the money as “gift” to help yourself get back on your feet.

But you need to be careful about depending too much on family and friends for money. You wouldn’t want to be perceived as a “leech”. After all, money has been fueling lots of fights, estrangements and resentment since time immemorial.

Online lending apps

Online lending apps (OLA) have been sprouting up over the past few years. These apps offer quick cash loans with fast and high approval rates. These apps do not require too many paper documents, a physical presence, a collateral or credit history. In most cases, you will only need to upload a photo of your valid ID.

In an OLA, the whole loan application process can take as little as five minutes. You can get your loan through the app itself, your bank account or e-wallet.

While OLAs are convenient and can be good alternatives if you have a bad credit history, they can charge you high interest rates and other hidden fees. They can also give you a tight repayment schedule. Some apps do not give out loan contracts, making it difficult to have something to back you up in case you have to dispute the terms.

Perhaps the biggest downsides of OLA are the threats of scams and abuse. There have been multiple reports of money getting stolen through hacked accounts, fishy links and fake OTPs. Meanwhile, abusive agents have been harassing late-paying customers, resorting to SMS and social media threats and visits from collection agents.

Want to fix your bad credit? Try UnaCash!

OLAs get a bad reputation due to unscrupulous apps and agents, but that doesn’t mean that the whole industry is rotten. If you’re looking for the app that will give you the best loan rates, terms and service, go for UnaCash!

Through UnaCash, you can borrow from as low as ₱2,000 to a maximum of ₱25,000! Enjoy flexible loan terms of up to 6 months!

Since the whole process is 100% online, you can get your loan in as fast as 5 minutes! Your loan will be disbursed through your bank account, e-wallet or preferred remittance center.

Aside from loans, you can shop your essentials now & pay later with UnaCash Credit Line! Shop from our partner merchants and get as low as 0% interest! The interest rate depends on the merchants.

How to clear a bad credit history in the Philippines

A bad credit score or history is not the end of the world. While it may be a daunting task at first, you can still improve your credit history through these steps.

1. Pay off existing debt

Any existing debt will always drag your credit score down, so you must pay them off as soon as possible. You can start with loans with the highest interest rates. If you’re having trouble paying off debt, consider increasing your cash flow or loan restructuring.

2. Always keep a record of your bills

Keeping a record of your bills will help you track where your money goes in terms of utilities and subscriptions. It helps you stay on top of due dates and how much you’re paying every month.

To avoid missing a due date, set up regular reminders or look into automatic debit arrangements from your credit card or bank account.

3. Track your expenses

Practice discipline over your money. Keep track of your expenses particularly if you’re fond of your credit card or online shopping. Measure your expenses against your monthly budget in order to prioritize necessities and cut needless spending.

4. Don’t apply for new loans or credit within a short period of time

As much as possible, avoid applying for multiple loans or credit within a short span of time. Doing so may give the impression that you are reliant on credit and have no sufficient cash flow to support yourself.

5. Get a credit report

Having a credit report at hand can help you form a strategy on how to clear your bad credit. You can request a credit report from the Credit Information Corporation (CIC) if you want to know more about your credit score and history. Your CIC report contains a summary of your financial transactions submitted to the agency.

Conclusion

It’s very simple to fall into the trap of bad credit and extremely difficult to get out of it. Once your bad credit accumulates, your credit score will sink and you won’t get approved for a new loan. A poor credit history may also affect your employment and insurance.

But worry not, bad credit can still be cleared and you can still get a loan despite it. You can borrow from family and friends, informal lenders, online lending apps and UnaCash. These options can give you the best possible loan rates without seeing your credit history.

Written by: Alyssa Divina | Edited by: Karla Maolen Visbal