How to Get a Personal Loan in the Philippines Even with Bad Credit

🌧️ When Credit Feels Like a Closed Door

If you’ve ever been denied a loan or felt embarrassed about your credit score, you’re not alone. Many Filipinos—especially those who’ve faced job loss, medical emergencies, or pandemic-related setbacks—carry the weight of a low credit score or no credit history at all.

But here’s the truth: bad credit doesn’t mean no options. With the right mindset, tools, and guidance, you can still access a personal loan—and even use it to rebuild your financial future

“Your credit score is just a snapshot of your past. What matters more is what you do next,” says Lesley Ann Perez, a Makati City-based financial adviser.

What Is a Bad Credit Loan?

A bad credit loan is a type of personal loan designed for people who have a low credit score or limited credit history. These loans are typically offered by non-bank lenders, fintech platforms, or microfinance institutions that use alternative ways to assess your ability to repay.

Unlike traditional banks, these lenders may look at your current income, mobile wallet activity, or even your payment behavior on utility bills.

🏦 Who Offers Loans to Borrowers with Bad Credit?

While most banks in the Philippines are strict about credit scores, there are other lenders who are more flexible:

✅ Online Lending and Buy Now, Pay Later Apps

• Mocasa
• GCredit, GLoan, GGives
• Maya Credit and Maya Loans
• Lazada Pay
• Shoppee Pay and Shoppee Pay Later
• Tala
• Cashalo
• Digido
• Online Loans Pilipinas
• CIMB Credit and Loan

These apps offer fast approvals and minimal paperwork. However, interest rates can be higher, so it’s important to read the terms carefully.

✅ Non-Bank Financial Institutions (NBFIs)

• Global Dominion Financing
• Asialink Finance
• Radiowealth Finance

These lenders often offer secured loans, where you use your car, motorcycle, or land title as collateral.

“If you have a tricycle or even a secondhand motorcycle, that can be your ticket to a loan,” shares Maricel Tan, a financial literacy coach who works with small business owners in Laguna.

🛠️ Step-by-Step: How to Apply for a Loan with Bad Credit

1. Check Your Credit Report

Request your credit report from the Credit Information Corporation (CIC) or its accredited bureaus like TransUnion, CIBI, or CRIF. This helps you understand what lenders see.

“You can’t fix what you don’t know,” says Tan. “Start by knowing your score.”

2. Compare Lenders

Look for lenders that are transparent about fees and don’t require upfront payments. Read reviews and check if they’re registered with the SEC.

3. Gather Your Documents

Prepare:

• Valid ID
• Proof of income (payslip, remittance, or business permit)
• Proof of billing
• Collateral documents (if needed)

Some lenders may also ask for a co-maker or guarantor.

4. Start Small

Apply for a manageable amount—₱5,000 to ₱10,000. Repay it on time to build trust and unlock better loan terms in the future.

“Think of it as a stepping stone,” Cruz explains. “Once you prove you can repay, you’ll have more options.”

5. Use the Loan Wisely

Borrow only for essential needs like:

• Emergency expenses
• Business capital
• Tuition or upskilling
• Debt consolidation

Avoid using loans for non-essentials like gadgets or vacations.

⚠️ What to Watch Out For

Bad credit loans can be helpful, but they also come with risks:

Risk	What It Means
High Interest Rates	Some lenders charge 20–40% annually
Short Repayment Terms	You may need to repay in 30–90 days
Hidden Fees	Watch out for processing or late payment charges
Debt Traps	Rolling over unpaid loans can lead to a cycle of debt

“If a lender asks for payment before approval, walk away,” warns Tan. “That’s a red flag.”

🔁 How to Rebuild Your Credit After Getting a Loan

Getting approved is just the beginning. Here’s how to use your loan to improve your credit standing:

✅ Pay on Time

Late payments hurt your score. Set reminders or automate payments.

✅ Track Your Progress

Use the Credit Kaagapay Tracker to log your score, set goals, and monitor habits.

✅ Keep Your Debt Low

Avoid maxing out your credit limit. Keep usage below 30% if possible.

✅ Check Your Report Regularly

Look for errors or outdated information. Dispute inaccuracies with the CIC.

“Your credit score is like your financial reputation,” says Cruz. “Protect it like you would your name.”

📣 Real Stories, Real Progress

👩 Liza, 36, Single Mom from Caloocan

“I missed payments during the pandemic. My score dropped to 520. I tried applying for a bank loan—denied. But I found a fintech app that approved me for ₱7,000. I paid it off in 3 months. Now my score is 640. Slowly but surely.”

👨 Mang Tonyo, 52, Sari-Sari Store Owner

“I used my tricycle’s OR/CR as collateral. Nakuha ko ₱20,000 pang dagdag puhunan. Mahirap sa una, pero nakabayad ako ng sa loob ng sampung buwan. Ngayon, mas madali na ako ma-approve dahil sa pagbabayad ko sa oras.” (I obtained a P20,000 loan to add to my capital for my small business. It is very challenging at first, but I was able to pay it in full in 10 months. With that, I can now easily get a loan because of my good repayment record).

🧰 Tools You Can Use: Credit Kaagapay Tracker

To help you stay on track, Credit Kaagapay offers a free downloadable Credit Score Tracker. It includes:

• Monthly score log
• Payment reminders
• Goal-setting templates
• Tips to boost your score

📥 Download it now and take control of your financial future

💬 FAQs

❓ Can I get a loan even if I have unpaid debts?

Yes, but it depends on the lender. Some may approve you if you show proof of income or offer collateral.

❓ Will applying for multiple loans hurt my score?

Yes. Too many applications in a short time can lower your score. Apply only when needed.

❓ Can I get a loan without a credit check?

Some online lenders offer no credit check loans, but they may charge higher fees.

‘Hindi Ka Nag-iisa’

Having bad credit can feel like a dead end—but it doesn’t have to be. With the right support, you can bounce back stronger.

At Credit Kaagapay, we believe in second chances. Whether you’re rebuilding from scratch or just starting out, we’re with you every step of the way.

“Your past doesn’t define your future,” says Tan. “What matters is what you do next.”