You have found that one side of your house has been infested by termites. You know that you can’t keep it that way for long as the rainy season is about to come in within a few weeks and getting it repaired is quite necessary. But being short with cash in your savings, you decide to get a personal loan that can actually help you with the repair. The only question is will you get approved?
Getting approved by a personal loan only requires preparation. Here are a few items you can look into why personal loans get rejected to ensure you know what to watch out for.
- Bad Credit Score. Sometimes, this can be a sole reason for the bank or lender to reject your application. A bad credit score can mean a lot of things to a lender. It can reflect how you handle debt and how you deal with credit. It is very important that you make sure your credit score is good.
- Insufficient Income. One of the reason that a personal loan can be rejected is having insufficient income coming in monthly. This definitely alarms the lender or the bank as it means that you will have difficulty in paying off your debt.
- Having too many loans. It is important to note that a lender will always look for existing loans as well. The reason for this is that they need to estimate your capacity to pay. You may have a good income reflected in your pay slip but it may not be enough because you are paying off other loans.
- Inconsistent Information. When completing application forms and indicating other details in your application needs to be consistent with your submitted requirements. If your information is not consistent, then it becomes a problem for the lender on which information is true. Some lenders can be strict by rejecting the application straightforward.
- Falsified Documents. You need to make sure that the documents you submit is true. Any document or requirement that is proven to be falsified automatically renders the application rejected. To top it off, your name can be submitted to a database who submit fraudulent accounts.