Getting your loan approved isn’t the simplest process. There’s a dizzying range of loan options out there, with lenders competing heavily for your attention.
It can be hard to filter through your options, and that’s before taking into account things like credit score and whether you should secure your loan or not.
Worse still, once you’ve found a loan that suits your needs, getting approved can prove surprisingly tricky.
Here are 9 tips to help you get past the roadblocks and have the highest chances of getting your loan approved.
Make sure all the basics are correct
You don’t want to give a lender the simplest reason to refuse you, so before you send your application across, make sure that you’ve double checked every detail.
Are your name, address and employment details correct? Have you filled in every required section, leaving nothing out? It’s simple things like this that can cause an application to be rejected, especially if you’re applying online, with less chance to amend things.
Check your credit rating
Checking your credit rating is an excellent step to take as it gives you a much more secure idea of where you stand and what loans are available to you.
Some lenders will specify a certain credit rating, and others will specialise in lending to people with more diverse histories. Payday loans companies generally have less stringent requirements, so can be a solid option for people who might be refused a more traditional loan.
Don’t apply to too many loans
Whenever you actually apply for a loan, it leaves a digital footprint on your credit score.
The issue with this is when you are rejected for several loans in a row. Lenders will see this, and question why other lenders have rejected you. This can put paid to even a decent application, as it can make you seem desperate for money and unable to repay.
In general, do not apply for a loan unless you’re absolutely sure you want it.
Know what loans are available
Knowledge is power, and knowing exactly what your options are vastly increased your chance of finding a loan that’s suitable for your needs.
There are a huge amount of personal loan options available to us, and literally thousands of lenders willing to provide credit to people like you.
Make sure you check multiple lenders, online and offline, before settling on anything. The more options you consider, the better armed you are when it comes time to make a decision.
Once you’ve found a loan that’s suitable for your purposes, a good choice is always to contact the lender, whether that’s a bank or credit company, and ask them directly about requirements and loan eligibility.
If you’re getting a loan from a bank, you might need to make a personal appointment and bring identification and details, so it’s good to be prepared up front.
Make sure you know the purpose of the loan
Certain loans are only designed for certain purposes. Whether secured or unsecured, there might be things that you cannot use your loan for.
A great example of this is the current trend of cryptocurrency investment. Many lenders will specify that personal loans cannot be used for this reason.
Make sure you meet the income requirements
Loans generally have a minimum income requirement, and some may need proof of verified employment for a certain amount of time before considering giving you a loan.
Remember, lenders want you to be able to repay your debts. It’s better for the both of you. They don’t want to have to chase you for money, or call in debt repayment services, and you don’t want to affect your credit score or have money problems.
Consider early repayment
Remember, it’s usually possible to pay off a loan early, so if you get into a position to do so, and save money in the long run, you don’t want to be hit with heavy charges for doing so.
Check if your particular choice of loan has early repayment options, and what they are. If you think there’s a good chance you’ll be able to pay off part or all of your loan early, you’re far better suited finding one with no charges.
Consider borrowing more
A general rule of thumb is that the larger the loan, the cheaper it is. Because of the way loans are bracketed, you might actually save money in the long term by borrowing slightly more.
For example, a loan of $2000 could cover what you need, but have a higher APR than a $2500 dollar loan, which could mean higher repayments and paying more back, long term.
Ask your loan provider if there are any options regarding this, when you’re taking out your loan.