Have you ever been in a dire need for money and just when you were seeking external financial help, your lender rejected your personal loan application? Well, if that has happened to you before, you might certainly be aware of how disheartening it is to see your loan application being rejected when you needed the money desperately!
Now, when such an incident happens, we are often pondering over the reason which led to the rejection of the loan. Cut short your line of thoughts and get clarity today so as to avoid any further loan rejections!
Here are some of the reasons why your lender might be rejecting your personal loan request.
- Multiple loan applications – we understand that you need those bucks very urgently. But, if you are making numerous applications, it is not going to be of any worth for you. Constant inquiries and loan applications are only going to worsen the existing situation. We know you undertake the steps in order to ensure the approval but this further gives a negative impact over your credit score thus leading to rejection from the lenders.
- Poor credit history – one of the biggest and important reasons for the rejection of the loan application can be your questionable credit history. If you have been borrowing money from banks from quite some time and not repaying the same, there are certain chances that your credit history is ruined. Most of the lenders do not wish to risk themselves with borrowers having a bad credit score. You can choose to improve your credit history by repaying your due payments and bills in order to avoid rejection of your loan applications.
- The high amount of debts – if you have a number of debts against you, there is a high possibility that your bank might reject your loan application. The reason for the same is that the bank looks at you with eyes of suspicion and considers you as a risky borrower. These reasons further result in rejection of your personal loan application.
- Unstable history of employment – you are likely to get rejected if you have an unstable history of unemployment. Let us say you have been leaving jobs frequently in your past and you do not have a stable employment history for your lender to trust upon, then there are chances of rejection of your personal loan application.
- Incorrect documentation – if the above-listed reasons are not the ones that have got you rejected, chances are your loan application has been discarded due to providing incorrect documentation. In order to avoid this, make sure you double check the documents before finally submitting them to the bank. On the other hand, additionally, re-confirm with your lender about the documents that you are required to submit.
Better late than never, right? So, before you reach out to a lender with a personal loan application, make sure you have relooked at the checklist given above failing which you might be turned down again!