5 Ways You Can Improve Your Chances Of An Approval For A Personal Loan

11 December 18

credit score

After all, every lender who approves a loan wants to be sure that you make good on your debt. Here are the following steps to ensure that you are approved for the loan when you need it most.

Clean Your Credit Report Up

Be sure to review your credit report to deal with mistakes that could be lurking on the report. Mistakes such as wrong accounts, incorrect credit limits and closed accounts noted as being open could hinder your credit score. Be sure you make all your payments on time and pay down the debt as quickly as you can.

Rebalance The Income to Debt Ratio

If your debt is more than your 30 percent of your income, you’re likely to be turned down for a loan. Be sure to sell property you no longer need or get a second job to pay down your debt quickly. Put the money on the higher-interest debt.

Ask For Only An Amount You Need

Do not ask for more money than you really need. Lenders see a problem with this. Give them a reason for the dollar amount and ask for just the amount you need. A larger loan than you need also means higher repayments each month. This could hinder you from meeting other financial obligations.

Have A Co-Signer

If your credit score isn’t that great, consider having a co-signer for you – someone with better credit and a good income to boost your approval chances. If you can’t meet your obligations, they should be able to because they’ll need to repay on the loan themselves.  

Find A Lender That’s Right For You

The majority of online lenders let you know about annual income and credit score requirements before you apply for a loan. Be sure to see if you’d qualify for the loan first. Do this pre-qualification step with several lenders before you settle with any one of them. Finish out the loan process with one that meets your needs and budget.