Rebuilding Credit After Bad Debt

Published 01 June 2022. Contributed by Credit Bureau Singapore.

What leads to bad credit?

A Credit Report is a reflection of your current financial standing of your personal credit facilities contributed by members of Credit Bureau Singapore (CBS). Read back on the previous article here if you want to understand more about Credit Report and Credit Score.

Bad debt can be referred to as loans or outstanding balances owed that are no longer deemed recoverable and must be written off by the credit lender. Most of the time you might even feel the struggle of paying for your own basic expenses using cash and you find yourself relying heavily on credit terms to make ends meet.

In summary, lenders use your Credit Report to assess your credit worthiness and determine your future loans repayment behaviour. Such powerful information is crucial and may affect your life, which is why having a good credit score is highly treasured. Let us dive in deeper on how having a good credit report may potentially affect you.

Default records

Default records are severely delinquent payments that arises from unpaid arrears. These are basically written off outstanding loans that were recorded by the members of CBS in your Credit Report. Default records with the status of Negotiated Settlement or Full Settlement will be displayed for 3 years from status date. For default records with the status of Outstanding, Partial Payment and Sold Off, the records will be displayed indefinitely on the report. The definition of Negotiated Settlement, Full Settlement, Outstanding, Partial Payment and Sold Off statuses are subjected to individual financial institutions’ classification.

Steps to rebuild your credit reputation

If you are still in the midst of paying off your outstanding loans, seek for external help such as debt counselling programs or repayment assistance scheme that will help you to manage your financial obligations better.

However if you have already settled all your outstanding loans and wish to get your credit reputation back on track, here are some steps that you can take below:

1. Spend within your own means

The most important step to repair your credit score is to prevent yourself from falling back into bad debt again, which means to only spend what you can afford. You can set a budget plan and prioritize your expenditure starting with needs to wants. Always be realistic rather than be over ambitious to what you wish to have, example: taking public transport rather than owning a car.

2. Wean off on paying on credit terms

The first step to getting out of the debt cycle is to reduce your reliance on using credit facilities to pay for your expenses. For example, use more of your debit cards to pay for your expenses rather than your credit cards. This will help to curb any overspending habits since you are now only able to spend within your own income limit.

3. Maintain a good repayment status

Keeping a good credit repayment record will help you to gradually build up your credit score. If you are still able to apply for an Unsecured Credit Card or keep your previous credit cards, you can start off by making small payments and pay back your bills promptly and in full. Otherwise, you can consider applying for a Secured Credit Card which usually requires you to pledge a fixed deposit account.

4. Check your Credit Report

It is highly encouraged to review your report from time to time so you are aware of any inaccurate or outdated data that is loaded onto your credit report. Alternatively, you can also subscribe to My Credit Monitor (MCM). MCM is a credit monitoring tool that helps you to keep an eye on your credit report on your behalf so you can have an ease of mind wherever you are. MCM comes with a choice of 6 months or 12 months subscription service and complimentary credit reports. The subscriber will be able to receive notification alerts for any predetermined activities on your credit report, providing the earliest possible indicator via SMS or emails. Hence, you will always be notified should there be any new information loaded onto your credit report.

Where can I get help to rebuild my credit reputation?

TCC Credit Co-operative has helped many people to rebuild their credit reputation with its consolidation loans. Consolidation loans are meant to help pay off your outstanding to the various financial institutions, and you can just do your monthly repayment to TCC Credit Co-operative. If you have any questions, please contact us at 6319 3700 or email us at

Where can I get a copy of my credit report?          

To check your credit score, you can purchase a copy of your credit report at