4 Reasons Why You Might Be Rejected for Online Loans - PowerPoint PPT Presentation

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4 Reasons Why You Might Be Rejected for Online Loans

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Have you been refused a loan? Not sure what or why you should do next? Getting turned down for a loan can be disappointing, especially when you do not understand why you were refused. But not to worry, lenders all vary, and some specialise in lending to borrowers who have had credit rating issues. – PowerPoint PPT presentation

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Title: 4 Reasons Why You Might Be Rejected for Online Loans


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Rejected
4 Reasons Why You Might Be Rejected for Online
Loans
  • Have you been refused a loan? Not sure what or
    why you should do next?
  • Getting turned down for a loan can be
    disappointing, especially when you do not
    understand why you were refused. But not
    to worry, lenders all vary, and some
    specialise in lending to borrowers who have had
    credit rating issues.
  • If you have been refused online loans,
    some lenders will usually let you know the
    reason for the refusal within a week.
    However, it may vary from lender to lender.
    You are entitled to ask the lender why they
    rejected you for the loan, but they need not have
    to give you a detailed explanation. But if you
    are not sure, chances are it will be one of
    these four common reasons.
  • Poor Credit Score
  • Lenders tend to base their decisions on several
    factors, but the most important factor in
    getting a loan approved is your credit
    rating. Most borrowers are not aware of
    their credit scores. A bad credit rating is
    a red flag to lenders and gives them a
    general impression of how much of a risk you
    pose. Even if you get approved for online loans

with bad credit, you might get higher
rates of interest. Some websites, such as
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  • Experian, TransUnion, Equifax, etc., allow
    you to check your credit score for free for
    a limited period. It is better to check your
    credit rating when applying for a loan.
  • Not Enough Employment and Income
  • Employment with a stable or regular income
    is a common requirement for lenders. It
    plays a crucial role in helping to approve your
    loan with low or affordable interest rates from
    the lenders and assures them that you can
    repay the amount. Your online loan
    applications could get rejected if you do
    not have a stable or regular income. For
    instance, if you are applying to borrow a large
    amount and your incomings are low, you will
    have a low chance of getting approval. To avoid
    this, ensure that you can afford the loan
    repayments before applying.
  • Not Meeting the Basic Requirements
  • Every lender sets their eligibility
    requirements, but most check for a few basic
    criteria, such as
  • The minimum age requirement is over 18.
  • a UK citizen
  • must be employed to afford the loan.
  • must not be bankrupt.
  • Made Too Many Loan Applications

many and which ones you have made.
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Always try to minimise the number of
applications, as lenders may see this as a red
flag and think you are in financial
trouble. Once you decline by one lender,
never keep applying for others. Instead,
look out for lenders who perform soft
searches as it does not affect your credit
rating, and the check cannot be visible to other
lenders. Can a loan rejection affect my credit
rating? Being turned down for a loan does
not affect your credit score. But the act of
applying will leave a mark on your credit
report. However, when you apply for a
loan, the resulting hard search pulls down your
credit rating a little. If your loan
application gets declined, it is important to
identify the reasons why. If you understand
what happened, you can take steps to
improve your chances for the next time.
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