Having a good credit score improves the chances of loan application approval but still there some other reasons which can lead to rejection. Given below are dos and don’ts to avoid rejection of application.
New Delhi: Personal loan is useful for the people who fall short of funds for expenses such as medical emergency, vacation, etc. As per the respective bank’s eligibility parameters, both salaried and self-employed individuals can avail the personal loan.
Personal loans are available easily at competitive rates, which can offer you a good deal. Though, having a good credit score improves the chances of loan application approval but still there some other reasons as well which leads to application rejection. Given below are some dos and don’ts to avoid rejection of loan application-
1. In case of inadequate bank balance, lenders reject your loan application. While considering your loan application, lenders go through your minimum net monthly income, income stability and then accordingly sanction your loan.
2. Before applying for the personal loan, ensure timely repayment of your existing credit cards, bills and loan EMIs. All these things affect the credit score. Lenders check your track record of debt repayment, credit card dues payment and loan EMIs.
3. While filling loan application make sure it is error free. Lenders do not consider applications with mistakes. It is important to state actual and genuine facts in the applications. It may be noted that the loan application approval depends on the timely submission of the required and supporting documents as well.
4. One should not go after taking multiple loans. It increases the chances of debt trap which ultimately affects the credit score. People generally take more than one loan to fund their expenses which proves to be disastrous of financial security.
5. Before taking a loan, it is better to compare the various personal loan offers and rates. In order to finalise the best deal, make sure to compare it both online and offline.
6. Before sanctioning the loan, lenders consider the applicant’s job stability. If you make frequent job switches, your loan application might get rejected. Apart from this, lenders also consider the time period of your existing employer as well.