Understanding Short Term Loans Rejection
Understand why applications for short term loans are rejected and how you can fix it.
Short term loans allow you to enjoy financial freedom despite unstable source of income and a rock solid credit history. You can successfully meet both your personal and business needs, and almost all kinds of expenses while improving your finances and credit score.
You are not eligible
Before you click the submit button of an application form, or hand it manually to the loan officer, check the eligibility criteria first.
Most of the lenders have their own criterion and preferences. Perhaps a particular short term loan company is offering loans to people who are nearing their retirement age, while others simply want their borrowers to be in the working class-or those between 21 to 65 years old. It is also important to know about the minimum income they are requiring their borrowers to make each you. There are also lenders who give preference to clients with credit cards and long standing bank history with certain banks. Those who have defaulted on their previous bills and loans may not be approved by some loan providers, as payment history is one of the most common eligibility criteria in approving loan applications.
You have zero credit score
When you have No credit, it means that you have never used credit –and therefore lenders have no way of reviewing your credit history. if they cannot make an educated decision on whether or not you have the capacity to repay the loan, or you have the tendency to avoid it, how can they determine if you will qualify for and make regular payments on your loan today?
Sometimes a bad credit score is far better than not having one at all. Many lenders prefer borrowers who have somehow established a borrowing relationship with a particular credit provider, because they could at least check their repayment history. So, if you see a loan offer, ask the lender about the credit score requirement. It is important information that lenders try to determine before they approve your loan application.
If you have used up more than 30% of your allowable debt, or you have large credit card balances, or both, your credit score may suffer. Sending too many inquiries as you shop around for affordable credit can also negatively impact your score. Those who have been in default also raise red flags.
You can also request for credit from the top credit bureaus in the country so that you can rectify some inaccurate negative entries before you apply for a loan. You can either file a dispute directly to the credit bureau or inform the credit provider about it, so that they can update the provided information. It will help you increase your chances of getting the short term loan approved and also might qualify you for a lower interest rate.
You have incomplete financial documents
If you cannot present proof of income which is usually required when applying for a loan either because you are unemployed, underemployed, or you have just started out your own business, the loan approval process may not go smoothly. Most lenders also require a work history to see how long you are able to keep the job, and how long you have been working for your current employer—such information helps lenders determine your job stability. Recent job loss, frequently moving from one company to another and not being able to keep the job for at least a year on a repetitive basis; may be interpreted by creditors as signs that your payments may not be as reliable as you claim to be.
Most credit providers want verifiable financial documents like income tax return, payslip and other similar papers that provide all important details of your financial capacity. So, make sure that you have them ready whenever you apply for a loan. Fill it up with updated and accurate information to the best of your knowledge so that lenders do not need to cross check them.
Other thing that credit providers look at is whether or not you have assets that can go after should you default on your short term loan. They might be interested to know if you have secured debts aside from the unsecured ones. You might have a batter chance of getting approved for a loan if your debts are diversified, especially if you still have no secured loans that use your sizeable assets as collateral.
Emergency situations are unavoidable. They come anytime—and even when you have things under control, there are some events that will question our ability to handle our money wisely. So, when you meet a financial crisis, it will be helpful to know that you can get through a financial crisis using short term loans at NSW Mortgage Corp. We offer personal loans to help you face an emergency situation at any time. We help you get some cash to meet the personal needs, and the process of getting a loan is really that simple. Make an enquiry today!