Five Reasons for Refusal of a Personal Loan

Don’t you wish personal finance were a mandatory course in college? Unfortunately, too many of us learn by mistake. When you need a personal loan and are rejected, you might be baffled as to what went wrong- and how to fix it. Here are some clues.

NO CREDIT

No credit is a situation where you have never used credit and therefore have no credit history for the bank to review. They have no way of making an educated decision on whether or not you will pay back a personal loan based on your credit history. No credit is worse than bad credit. Qualifying for and making regular payments on these types of introductory forms of credit can overcome a “no credit” score:

  • Student Loans
  • Secured credit card (includes a down payment amount)
  • Being added to a parent’s or spouses good credit: card, car loan, etc.

LOW CREDIT

Low credit takes on several forms. If you’re using more than 30% of your allowable debt, it can negatively impact your score. Too many inquiries from shopping around for loans will also hit you hard. Lapses in payment, defaults, or bankruptcies are giant red flags and can take a long time to rebuild from.

Other things that lenders may look at are whether or not you have sizeable assets should you default on the loan. They also check to see if your debts are diversified or if you are only carrying one type of debt.

INCOME

Proof of income is generally required when applying for a personal loan. If you are unemployed or underemployed, it can work against you in the loan approval process. Lenders may also require a work history to see how long you have been with your current employer, and to determine if you typically have job stability. Frequent job loss or change will tell a creditor that your payments may not be reliable.

PURPOSE OF THE LOAN

Believe it or not, your application can be rejected due to your proposed purpose for the loan. Financial institutions have the right to set up the parameters surrounding their disbursements and can accept or reject your application based on what you want to use the money for.

BLACKLISTING

If you’ve defaulted on debt before, your name may be put on a list of whom not to loan to,’ also known as a “Blacklist.” This will follow you around for a long time and is difficult to erase. If you do resolve the debt issues, get documents to prove the resolution.

NO CREDIT CHECK LOAN

If you need a loan now, but are concerned that you might not qualify for a personal line of credit, you can qualify for a No Credit Check Loan. You could be on your way to a better financial future in no time.

Understanding Online Loans

Online loans have become the latest fad. Many people love them due to the benefits that they come with. Unlike the traditional loans that require you to wait for weeks or even months before you receive them, Online loans are released in your account immediately the loan lender certifies that you are qualified.

How to get the online loans

Getting the loans is easy. All you need to do is to visit the website of the lender and make your application. To increase your chances of getting the loan carefully read through the requirements required and provide them.

The cool thing is that online loans are one of the easiest to get. In fact, when you apply for them, the lender will give you the loan even if you have bad credit. All the lender wants to know is whether you can afford to pay. To prove that you can repay the loan once it’s given to you, you should provide a bank statement or proof of employment.

Benefits of online jobs

As mentioned above, many people are going for these loans due to the comfort that they come with. Some of these advantages include:

Ease of access: This is a no brainier. As mentioned, you don’t need a stellar credit score to get these loans. As long as you prove that you can afford to repay the loans. You are ready to go. This is unlike with the traditional loan lenders that will require you to have a good score to get the loans.

Also, you don’t have to travel to your bank to get the loans. All you need is a computer and internet connection, and if the lender certifies that you can repay the loan, he/she will send you the money to your account instantly.

Payment options: Unlike with traditional loans where the repayment of the loans is decided by the lender, with online loans you agree with the lender on the amount that you will be repaying. In addition to this, in the event you lose a job, you can contact your lender and adjust your repayment.

Factors to consider when getting the loans

When you are borrowing the loans, you need to consider a number of factors for you to get the right ones. These factors include:

Amount to borrow: How much money will you be borrowing? The amount allowed differs from one lender to another. You should do your research and find a lender who will give you an amount that you will be comfortable with.

Repayment period: This is the amount of time that you need to repay the loan. Again this differs from one lender to another. The cool thing is that you can reach an agreement with the lender and settle at an amount that both of you are comfortable with.

Interest charged: The loans are known for their high interest, but this doesn’t mean that you have to pay high interests all the time. Before you take a loan, scout for lenders with the best rates.

5 Situations When Personal Loans Can Save the Day

With a rock solid credit history, you can successfully apply for personal loans and expect a swift processing of the same for meeting temporary financial glitch in life. Personal loans are all-purpose loans that can be availed as secured or unsecured loans. These can be used for multiple reasons and the purpose need not be disclosed ever to the lender.

The interest rate of loan depends on the tenure and credit score of the borrower. These can be drawn for a few months to several years as per your requirement.

5 situations when you can use personal loans as a smart financial move:

  1. When you have immediate cash needs: It is practical to use short-term personal loans to bridge the shortage of funds in your life. You can use the funds to support any of the sudden cash emergencies like medical expenses, home repair or funding a foreign trip. The purpose of loan doesn’t affect its interest rate, however your income and duration of loan does. All you need here in a planning stage is to have a strong back up plan for repaying the loan. The repayment will improve your credit score and add to your future worth at the same time.
  2. To avoid bad credit situation: In case you have lost a job or face a sudden spurt of personal expenses such as a wedding or some other expense in your life, you can take recourse on personal loans. Bad credit is a situation you should always avoid. If you have shortage of funds, rather than missing a loan repayment you can borrow some funds. The idea is to not let the score fall for temporary financial challenges.
  3. Consolidate multiple payments: When you have multiple payments to be made every month, it is better to simplify the process by consolidating the loan into one personal loan. By consolidating loans, you just have to pay a single repayment and that will pay for other loans. Availing short-term loans for bad credit is a practical means to mend mounting debts and save a financial mess.
  4. Additional funding for students: Being a student it is not always easy to keep a track on your expenses. Sometimes you need funds for reasons that your education loan misses to pay for. Herein you can apply for short-term loans for students as these are readily available. The short-term loan can also be used as a right way for building a good history.
  5. Business funding: Every new start-up or a business entity needs positive inflows. You need to maintain adequate supply of funds for maintaining sound terms with your suppliers and business associates. The short-term personal loans can be used as business loans to keep the flexibility of operations in your business.

In all of the above cases, personal loans can be used to better manage your finances. However it is prudent that you carefully read terms and conditions of a loan agreement and do not sign a very expensive loan. In case you find yourself unable to make a mind on the loan terms, you should contact a loan broker for a financial advice. He would guide you on the ways to manage your funds and keep your credit score healthy.

How to Find Your Perfect Loan With Poor Credit

Sometimes accidents happen and things break down and we all need help financially. If your current gas boiler stops working then a new gas boiler installed can cost a good couple of week’s salary and if the television is knocked over whilst the cat chases the dog around the TV room, then how do we find the money to get replacements?

Not all of us our lucky enough to have money in the bank, we live in a society where saving our hard earn money can be tricky, we all have mortgages, rents and utility bills to pay. If we do not have siblings or parents to go to when we find our self in that tight spot what can we turn to? Loans are a good option and can give you the finance you need fairly instantly.

The first thing to do is go online and visit a loans company. During the process of applying for credit the company will run your details though a program to achieve a Credit score, any bumps they find in the road in terms of poor score rating could hamper your chances of getting the money you require.

Why have I got a poor rating? There are many reasons why you might fall under the group of poor. The main reason is probably a late card payment, or even missing the payment altogether. Closely followed by an existing debt that you may have on credit cards, store cards or other cards. These will all show up in the overall score to ascertain if you can have the money.

Companies are fully aware that although some of us have a poor rating there are those that are trying to start again and look to the future. When you apply you have to give your personal information, bearing in mind that this information is important for the company to run the checks and will only be held by the company.

With this information they will look at any problems you may have had and also compare your current circumstances. For instance in the past you might have been on a lower paid wage and since then you have had a promotion and now earn twice as much as before. This will all be taken into account when running the scores.

A company that offer matching services, even though a poor credit score came up through the check, could still be able to offer you a variety of loans. They will pass your applications on to many different lenders to make sure that a deal can be found.

Choosing to go through a company like this will only show up as one application, not as lots of different ones which is a good thing for you and your rating.

Personal loans are known as unsecured, there is no collateral held against them but because of this they offer a higher percentage rate of payback. Credit scores can affect the percentage of the agreement given. The better the score, the lower the percentage rate.

We all want a quick decision when we apply for loans, but how quickly can I receive the money? If all of the relevant paper is filled in correctly, then you can have the money as quickly as the following business day. Which is good, as some emergency cannot wait for a week whilst a decision is made.

So if you need financial help, do not be put off that you might think you may have a poor credit history, approach a company that match loans and see how they can help you.

Personal Loan and Its Different Advantages

A personal loan is an unsecured loan which is offered to a consumer for catering their various personal needs such as the renovation of a house, marriage, home appliances, buy vehicle amid others. This is offered after verifying one’s ability of paying especially the income source and also according to their credit history. A nominal processing fee will be charged and the sum as per a person’s paying ability will get credited to their account. In fact the loan payment is made via fixed installments which also includes interest and for fixed time periods. The icing on the cake is these days personal loans are a smart choice as one do not require going through a lot of formalities and tedious paperwork. Most of the financial institutions and banks offer personal loans today and the rate of interest is also quite reasonable.

Discover the different benefit

  • Available easily- to get a personal loan is no longer a challenging affair. It is offered by almost all financial institutions and banks at a reasonable rate of interest. Compared to other loans it is convenient and easy to get
  • No middleman or agent involved- for availing a personal loan one will not require taking the help of an agent or a middleman. This will avoid unnecessary expenses and delays. A person can approach the financial institution or bank for the purpose directly
  • Unsecured loan- this is indeed an unsecured loan. Here no collateral security is needed for availing the loan. In fact, all that is needed is one’s ability of paying back the money.
  • Less processing time- because it is accessible devoid of any guarantee or security the processing time needed to get this is naturally less compared to other loans
  • All purpose loans- in this form of loan it is not compulsory for a person in specifying the reason for which they will be using the money.
  • Minimum paperwork- to get a loan will not need any asset verification or other forms of certificates and proofs which include ample paperwork as none of one’s property is mortgaged
  • Offers and schemes- different financial institutions and banks keep announcing offers and special schemes on personal loans, especially for the professionals such as architects, doctors, chartered accountants and the like
  • Amount and tenure- these loans generally are provided varying from Rs 15000 to Rs 20 lakhs differing from one bank to another. The repayment can be made through EMIs

The bottom line is, rather than borrowing money from a credit card it is always better to choose a personal loan as the rate of interest is comparatively lower. So reap its utmost benefits.

Searching for a Personal Loan Just Got Simplified

Figuring where to get a loan with the best rates isn’t easy, but it’s still possible even after the credit crunch the United States has experienced in recent years. With a bit of research and persistence, it’s still possible to get a great personal loan. Many loans are still ridiculously high in spite of the Federal Reserve’s influence on rates which they’d hoped would trickle down to each and every loan type product.

It’s smart to know what determines interest rates in order to strike a better deal when wondering where to get a personal loan. A bit of research will help a person learn how to get the best rates on the following:

1. Mortgages

2. Lines of credit

3. Home equity loans

4. Auto loans

5. Credit cards

6. Student and personal loans

About Mortgages

There’s a lot that affects mortgage rates, and of course there are several different types of rates from fixed-rate to adjustable. Fixed-rate are always in relation to the current state of the economy. They are also subject to the expectations of the investor. They usually have long-term interest rates via treasury note as opposed to short-term personal loans that are regulated by The Fed.

ARMs or adjustable rate mortgages are affected by short-term rates. For those looking to find where to get personal loans at the best rates, they should prepare a portfolio that shows stable income, and a great credit score. A score of 740 or more is best. If they have a down payment that will also help, and cash reserves on top of that makes them a prime borrower.

Of course, that doesn’t mean there aren’t great rates for those who aren’t considered “perfect” borrowers. Making a larger down payment or borrowing less money will help get a personal loan, be it for a mortgage or other purpose, that’s a much lower rate.

Another way to reduce rates when searching for where to get personal loans is to pay an origination free up front, or even what are called discount points. This is simply a percentage of the loan amount that helps decrease the interest rate. Of course, this means one will pay more at closing if mortgage related.

How much these points lower the mortgage or rate of the loan depends on the market at the time of the loan. It’s smart to pay points because it reduces not only the interest for the total life of the loan but also lowers the monthly payment. Take into account how long the home will be owned to figure out if it’s a smart move. Most homeowners sell or refinance within 5 years of ownership, to give an idea.

Home Equity Line of Credit

Many prefer to take advantage of a home equity loan in lieu of trying to get a loan elsewhere. In this case, borrowers get money right away and in a lump sum. The loan is set at a fixed interest rate, which allows them to make the same payment every month for the entire loan term.

These type of personal loans are lines of credit that let the borrower take out money periodically when necessary. The interest rate can be different, depending on what is called the prime rate. The borrower may have the choice of making interest-only payments over a set period of time.

In any case, to get the best rate when looking for where to find personal loans, it’s best to be aware of one’s credit profile and secure a loan whenever interest rates are at their lowest.

Competitive rates and flexible terms are a click away, and you’ll have money from trusted lenders deposited directly into an account of your choosing. Applications are free, then fees and loans are up to the individual and the provider.

Payment Options for Shopping All the Way

Everyone is busy. Busy in shopping online and in the malls. Popular online portals are breaking and making new sale records! All thanks to the convenience and the availability of easy payment options and funds!

Here are few of the factors that are making online businesses a success

Credit Cards: A credit card is plastic money. It is one of the easiest form in which a person gets a personal loan.

All online portals as well as retailers in malls accept credit cards issued by various banks.

  • Online payment becomes very simple and safe, thanks to the one time passwords generated for such transactions.
  • A PIN is sufficient for shopping using a credit card at any retail store.

Personal loans for shopping: When we apply for a personal loan, we don’t have to provide the financier with the details of what we want the loan for.

Thus these days’ personal loans are being used to finance shopping.

  • They can also be used as wedding loans, vacation loans and educational loans.

Payment Processing: As far as payment processing is concerned, the following factors matter to both the consumer and the online retailer.

Uncomplicated maneuvering on website: It is important for the payment process to be step-by-step and easy to understand. Most websites work on this section very carefully and thus the online shopping experience is satisfactory.

  • Processing Costs: Processing costs matter to the retailers. More the processing fees they have to pay to providers of payment gateways like Visa, the lesser are their margins. So to have an effective business the processing costs need to be low.
  • Number of payment options: Multiple payment options should be available for the customer to make payment. This makes the shopping a convenient proposition.
  • Time taken to process transactions: Processing time not only tests your patience but sometimes also the strength of your internet connection!

Cash on Delivery: This is also known as “collection on delivery.” This is a very popular mode of making payments for shopping in the developing world.

  • It enhances impulse purchases.
  • A credit card is not an essential possession for the buyer.
  • The buyer can check the quality of the product and then pay

So this festive season, do not hesitate to shop and to gift! The availability of funds for shopping is not difficult anymore. Also the convenience of online shopping has brought various retailers to our doorstep. So let us shop all the way!

Gift Yourself a Dream Wedding With a Wedding Loan

Weddings are known to be elaborate and expensive affairs. Right from the bridal trousseau and jewelry to the venue costs, catering and gifts for guests, the bills can be very expensive. But that doesn’t mean you have to let the money be a obstacle on your life’s most important moment. Make the occasion memorable for yourself and your family. You can take out a Wedding Loan and ensure that you all have something to celebrate, without having to worry about the costs.

When it comes to funding your wedding, it’s unlikely that you have enough savings to meet costs. The best option is through a Loan, most banks and NBFCs offer Wedding Loans. and you can apply for one to meet the costs.

What is a Wedding Loan?

In essence, a Wedding Loan is a Personal Loan taken to meet marriage expenses. A Personal Loan for a wedding can cover costs like buying jewelry for the bride, venue cost, guest accommodation costs, catering charges, decorator fees and other professional services that ceremony usually require.

Usually, the bank verifies your income and credit score before deciding on the loan amount that they can offer you. The higher your income and credit score, the better your chances to get the loan approved.

Before applying for a loan, it’s recommended that you get a rough estimate of the expenses. Based on your eligibility, you’ll be able to know what amount of loan you can get. That way, you can plan your wedding accordingly.

Why Do I Need One?

Besides the usual wedding costs, there can also be some sudden expenses. If you suddenly decide to live stream your wedding to your extended family who couldn’t make it, you’ll have to plan for that as well. All of this needs money, so it’s best to be prepared.

Destination and theme weddings are the fads at the moment. These can be very expensive. Ferrying guests, theme decor, coordinated costumes and more make these events some of the most expensive marriage ceremonies you can find anywhere. It’s not surprising that most of us don’t have the ability to pay for all of this through normal means. That’s why a Loan can be one of the best things that you can get.

You might be worried about taking the interest rates in Personal loans are high. You might not want to start your married life in debt. If that’s the case, you can borrow from your parents, friends or family at zero interest.

How To Apply?

Applying for a Wedding Loan is a simple process. You can also apply for it online and meet the document requirement to process the loan application.

5 Important Tips to Get a Personal Loan Approved

You might have a smooth running life, but that in no way means that there won’t be a problem with you. You can face an emergency situation at any point of time. So, for that, you need to be careful enough. A loan at this point of time can be a savior for you. It can help you meet a financial crisis. Through a loan, you are going to get some cash that will be helpful to meet the personal needs. But getting a loan is not that simple. There are certain steps that you need to abide by so that your loan plea gets approved.

Check the Eligibility Criteria

Most of the loan providers do have an eligibility criterion. Some prefer the borrowers to be within a particular age group, generally between 21 to 65 years. Another thing that they might be checking about you is a minimum amount of earning per year. Maintain that you are not a defaulter on any of your previous loans or credit card bills.

Verify Your Credit Score

A credit score is what the lenders are going to determine before they give you a loan. So, before you apply for the loan check for the credit score so that the loan plea does not get rejected. If your scores are not good enough rectify them. This will increase your chances of getting the personal loan approved and also might fetch you attractive interest rates.

Provide Genuine Details

When you are applying for the loan, make sure to provide all details that are true to the best of your knowledge. The lenders will doubt your intentions and will cross check everything. They might consider visiting you or giving you a call personally to verify the information you have provided. So, giving them genuine details will increase your chances of getting the loan approved.

Avoid Several Applications

Aim for a realistic loan amount that is payable by you. So not ask for huge amounts because in that case the plea might get rejected. Another mistake that most people make is applying at several places. The lenders will doubt your intentions and your probability to get the loan approved will be reduced. Also, multiple applications will affect your credit scores.

Have a Stable Source of Income

Having a stable work history is sure to impress the lending institutions. If you are having a minimum of two years of experience that will be an added advantage. Try to avoid switching jobs and maintain a stable source of income.

What You Need to Know on the Best Loan Rates

How Lenders Determine Qualified Applicants for the Best Loan Rates

A loan’s term is being calculated with the use of a tool known as risk based pricing. Essentially, risk based pricing is a system of analysis that determines the risks you pose to lenders as a potential borrower. Various factors including credit score, age and residential status are several of the measures being used in the final calculation. When you present lower risk as a borrow, you will be offered with a better overall rate.

Unsecured loans are tailored for individuals who look for monetary assistance without utilizing collateral. Any individual, who’s an actual or perhaps a house proprietor, can borrow the quantity below this provision. The sum provided for borrower’s problem is really a minimal quantity of £1,000 and elevated until £25,000. This quantity is catered for all classes of credit score holders having a fixed and brief reimbursement expression. And also the repayment time period is settled in between six months- ten many years at greatest. As, unsecured personal loans are fast to get trigger much less paperwork are adopted. Furthermore, within this chance the analysis of house isn’t carried.

Factors Affecting Your Credit Score – There are a lot of factors which can contribute to your overall creditworthiness. Even though this list is by no means exhaustive, a few of these factors include the following:

  • Duration of your credit history
  • Proven ability to manage credit as expressed through credit cards, previous loans and others
  • Amount you owe on average
  • Your tendency to source a new credit

How to Attain Your Exact Credit Score Before You Apply

If you are interested to have a better understanding of your creditworthiness prior to applying for a loan or any type of credit for that matter, there are several agencies that you can get in touch with. Lenders are going to use any of these agencies in order to get a copy of your credit details the moment you apply. But, some of them will be more than happy to render you directly a copy of your file for a nominal fee.

All in all, typical rates have not been designed to deceive interested applicants. In fact, it is far from it. In reality, these are only a means for a lender or loan broker to provide an accurate description of what rate typical customers are likely to be qualified for.

When you understand the mechanism being used for promoting a loan, you also decrease your chances of being disappointed.