Need A Loan For $1000 But Have Low Income?
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Have you tried going for a bank loan, but end up being rejected by the lenders without a clear answer why? These are some common reasons why borrowers are declined loans even though they have been loyal customers at their respective banks for years. Initially, not able to borrow money when you needed it may leave you wondering what had just happened. If you find yourself in such a fix, welcome to how banks and lenders choose to evaluate borrowers. Many people are not able to get a personal loan easily now compared to the past years. Since the subprime crisis, financial institutions now have to follow stricter lending guidelines so high risk borrowers will not be granted loans.

After being declined a bank loan, many people simply tried repeatedly at several other lenders. This is in fact the worst way to get a loan, because you will damage your credit history. Each time you ask for a new loan, the lender will make a search and this is recorded by the credit agencies. When many credit checks are made on your account within a short timeframe, it looks bad. Anyway, most lenders will not approve personal loans if you have been rejected within the past 30 days.

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The top reason you cannot get a $3000 installment loan approved is simply because you are not qualified for it and is not the type of borrowers the lender is prospecting. Before you borrow a new loan, make sure you verify the guidelines to see it suits you – such as minimum income, collateral required etc. Otherwise, going ahead with the paperwork is not only a waste of time – you will damage your credit score as mentioned above. There are many lenders with specific loan offers, so find one that is more likely to approve you based on your credit ratings.

For those having temporary or part time employment, not many lenders will give you a personal loan without collateral simply because of the risk of default. Most lenders prefer borrowers to have some income stability so that they have the ability to pay back the borrowed money. It is easy to get a personal loan with bad credit when you have a stable and well paying job. However, some lenders do offer unemployment loans for people who cannot find a job currently.

Are you asking to borrow too much money? Lenders may not want to give you a $15,000 unsecured loan when your monthly income is $1,500 which probably means you need about 24 months to pay back in full. It is important to be realistic about the maximum loan you can be approved based on your income and situation. Try a smaller loan or approach collateral/title lenders for easier approval instead.

Have you default on payments previously? This can be a very difficult issue to resolve since you cannot change your past. Thus, make sure you treat your loan obligations responsibly or you will have problems getting approved for unsecured loans for at least 6 years. Banks will not trust borrowers who have defaulted on loans since they are more likely to repeat due to financial difficulties. Substantial improvements in your credit score is needed in order to access new financing.

Do you have a lot of existing debts to be paid? If that is the case, your current debt-to-income ratio (DTI) may be too high, and you cannot get a new loan until some of these debts have been paid down. Try to clear off the smaller debts and close these accounts to increase your chances to get approval for bank loans.

Check your credit reports for errors and outdated information. For example, you may have fully paid off a loan but it still appears on your credit history, dragging your FICO score down. Do not expect the recorded info to be accurate, because many people have found errors using the free annual credit reports from Experian, Equifax and TransUnion. You can easily dispute credit report mistakes and get your score corrected.

If you have many credit cards and some are not being used, we recommend you close unused card accounts. On the other hand, you need to maintain a few credit cards with long history to avoid lowering your credit rating. Simply use these occasionally and pay the monthly balance on time. Having a lot of open accounts can make you appear financially stretched to potential lenders.

So, the next time you are declined for a bank loan, do not attempt to do it again elsewhere within 30 days. You are better off spending time and effort to increase your chances on the next try. Use the above guide for getting loans approved easily, such as checking your latest credit report for erroneous info.

Posted April 26th, 2012. Filed under Loans With Monthly Installments Personal Loans

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