“Your loan application is declined!” is not a comfortable phrase to hear when you’re in a state of emergency. The deepest concerns for banks, NBFCs and other firms are all the same. People who come across having good credit scores can also be subject to rejection for reasons unknown. Buddy Loan is renowned for its approval rate. Over 80% of approvals are personal loans that meet the personal loan eligibility criteria at Buddy Loan App. In most cases, you will find that the interest rate is a matter of objection for heavy pay-outs and longer tenures. But at Buddy Loan, you can choose a lender and customise the tenure and EMI based on your income.
There are reasonable loan rejections at Buddy Loan. Typically, there is much very little margin for rejection. Yet the extreme cases are listed below:
Past Loan Settlement Behaviour
Any financial firms considering your loan request will check on your past loan settlements. The term “loan settlement” is often mistaken with closing a loan. It is by definition the same, but with a minor difference. Debt settlement is a one-shot payment where you repay less than the availed loan amount.
Now, this might considerably reduce your credit score. Based on this behaviour, the study says that banks and NBFCs might reject your loan application straight out of request. Buddy Loan, however, informs the applicant in case of rejection.
History of Defaulting on a Loan
At Buddy Loan, there is no collateral required to avail a personal loan. Buddy Loan acquires all the information on the loan application and eligibility criteria to provide you with the list of lenders. There are cases where people default on a secured loan. Now, this is a major setback if you’re considering a loan again. The applicant might not stand a chance for another loan for a longer time.
Many Loan Enquiries and Requests at a Time
This is a common mistake many of them make. If you’re constantly inquiring about a loan in a limited time, the lender might get a greedy impression of you. In terms of a loan application, they doubt your submitted information and potential repayment.
Also Read: Good Credit Score But Still Rejected Loan
Incapable of Deciding The Lending Platform
Doing a bit of research before applying for a loan can help you a ton. But many people fail at doing this and thus remain clueless during the process. If you pick a lender that approves your request and over a short period, say you will need more money. You either top-up or you reach out to another lender. Now, this is by default the most unacceptable.
Instability of Income
One of the prime reasons for dismissing loan applications is the lack of stability in income. Naturally, repayment is of the question, when there is very little to do with your income. Those who apply for a personal loan can either be salaried or self-employed! If your financial situation is a recurrence of your employment history, then there are high chances that your loan is actually on the verge of rejection.
Naturally, the credibility of your profile drops and loses its creditworthiness. Buddy Loan, however, has various lenders across the country to help you increase your credit score. By not defaulting the loan repayment, you can get back your credit score in place.
Documentation and Cruciality
Improper records can not only dismiss your loan application but also go on dismissed records. Repeating your loan applications with the same improper set of documents can hit your credit score. Keeping your documents error-free and intact while applying for a personal loan can help your loans sanctions quickly.
Submit the right set of documents like proof of income, proof of identity and proof of address while applying for a personal loan online at Buddy Loan. The set might differ with each lender, and hence please make sure you submit your documents accordingly to approve your loan application with no hassle.
Steps To Overcome Loan Rejections
Lenders only reject your application if they’re inconsistent with the data, credit history, documentation and income study. When you provide all the information make sure you have the right set of error-free documents. Yet there are ample factors that go with it.
In many cases, the lenders don’t disclose the reason for rejection to you. This could be the place where you could reach out to them. Or get a credit report and clarify if there are any mistakes in it. There are always blind posts.
If you find any negative information that is inaccurate or not true contact your creditors and request to remove the same. They are only mandatory if you by default, default on the payment.
Submit a letter requesting the change in records for unnecessary faulty information on the report. There are high chances this could elevate your credit score levels.
A sudden drop in credit gear can be replaced easily by repaying some amount of debt. This elevates your credit score at one go.
Change your borrowing behaviour and thus your credit score. If you have not made time to build the credit, remove the negative information on your credit report so that there is room for improvement.
If you haven’t begun your credit journey, apply for a small loan or a student loan. Buddy Loan doesn’t take collaterals to list the lenders. You can straight away apply for the loan from the lenders listed by Buddy Loan.
Also Read: Tips and Tricks To Build Credit Scores From Bad to Good
Conclusion
With the above reasons in mind, you’re completely prepared to avail a personal loan through Buddy Loan. For a smooth and better loan journey, visit us at Buddy Loan
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