Availing a Personal Loan can be a life-changing decision. Whether it is for travel, to deal with medical emergencies or manage your wedding expenses, the fruits of a personal loan often end up in happy memories. The number of personal loans rose by 26.9% in 2018. So, it becomes all the more important to ensure that one takes the steps necessary to avoid getting your personal loan application rejected
There are several protocols one must follow to get a personal loan. Upon failing to do this, one’s personal loan application might be rejected. Mentioned below are the mistakes you could make which end up in the loan application being rejected.
When applying for a personal loan, document submission is an important step in the loan application process. It provides the lender with vital information about yourself and your capability to repay the loan amount requested. Therefore, ensuring that you have all the necessary documents in place is imperative. Moreover, the information provided must be accurate and genuine. Any discrepancy could lead to your loan application being rejected.
Insufficient Credit Score
Credit score determines the credibility of a borrower. It considers factors such as your credit repayment history. A credit score between 750-900 is considered to be ideal to apply for a personal loan. If you fall on the lower end of the scale, chances of your loan being rejected are extremely high!
Inconsistent Job History
Another way of gauging a borrower’s credibility is their employment history. How often you change jobs, how consistent has your income been, are some of the factors that your lender might take into consideration before deciding to offer you a loan.
The more debt you have, the less confidence the lender will have that you can pay back the loan. It follows the simple rationale that if you can’t pay the loans you have, how will you be able to handle even more?