5 Steps to Take if You?ve Been Denied a Personal Loan

Posted by mymoneymantra on June 18th, 2018

Have you ever applied for a Personal Loan for funding any immediate financial need? Being an unsecured loan, you need to pass the eligibility criteria to secure a Personal Loan. If due to any reason, you are unable to pass the eligibility criteria set by the lender, your Personal Loan application could be rejected.

The reasons because of which your Personal Loan application can get rejected are – low credit score, the problem with previous records, incomplete documents, and insufficient income and so on. To put this right, you need to re-correct your credit report, look for alternative options and ask for an opinion from those who have availed the facility of a Personal Loan.

5 things to do to edit your application:

• Search for the reason why your loan application can get rejected
• Re-correct the possible faults of your credit report – like low credit score
• Know your eligibility for the loan and apply for a credit report to understand it better
• Use alternative options
• Ask for an opinion from others

Search for the reason why your loan can get rejected

You have to prove to the lenders within a span of 30 days that all the details you have mentioned are true. This is generally done by showing original documents along with giving a copy of them for verification. But if something doesn’t fall into place, you receive a loan rejection letter. There is no point being upset about that; rather you have to find out the reason behind it.

Some common reasons for rejection are -  low credit score, no regular source of income, employment status may not good, too low income, the employer being a delisted company, being over-aged or under-aged, error in the documents attached like current address is not mentioned or is different in different documents. A mismatch of any document makes you ineligible for a Personal Loan. One good idea when Applying for a Personal Loan is to ask the lender to provide a list that mentions all the details.  

Re-correct the possible faults on your credit report

An issue either as big as low credit score or as small as a spelling mistake in the documents submitted can lead to rejection of your loan application. Certain issues can be corrected by the bank itself, or through other regulating bodies, while others may be your record that would take time to go towards positive.

If you didn’t pay for a previous loan in due time or the instalments were missed, it affects your credibility and the chances of the approval of your loan also reduce to a bare minimum. Banks or finance companies do not want their money to get stuck with someone who has had a history of bad debt. If you fall into that category, the first thing you need to do is increase your credibility. If low income is the reason behind the rejection, it can be easily tackled with a good credit score. Therefore, knowing the reason is of the essence. 

Know your eligibility for the loan and apply for a credit report to understand it better

Take your credit report into an analysis; find out the problem to identify the possible solutions. Without knowing the reason behind the rejection, it would be like finding a pin in a haystack to come to a solution or an alternative method of getting the funds required.

The alternative options available

A bank follows strict rules to ensure the loan is given only to creditworthy people, but there are other options to explore if your online Personal Loan application got rejected. There is a loan against property or gold if you need the money urgently and have been denied by the bank.

Ask for an opinion from others

Having multiple Credit Cards can be a reason behind the rejection of the application, such things are known by talking to people who have faced such situations. The credit report is a good way to check the discrepancies, but expert advice certainly has its own benefits. Ask a friend or relative who has been in such situation before. This would help in improving the overall application. Even secured loans can be thought of if the risk is too high as per the officials and is becoming the reason behind the rejection. You can speak to the loan specialists of MyMoneyMantra, for unbiased guidance for your Personal Loan application.

Use the alternative options

If nothing works, even a modified credit score is not allowing you to get the loan sanctioned, it is better to think of options other than the one applied for.

Having a clear idea of the loan procedures may help you with online Personal Loan applications. The minimum the faults, the higher are the possibilities to get the loan approved. Money is crucial to survival and is valuable only if available in time. Stay prepared with a good credit score to save your back in the time of distress.  

Also Read: What if the Bank Loses My Original Sale Deed

To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 60+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.

Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.