Well, no one likes rejection. When you’ve no way to arrange funds, personal loan could be quite helpful. But what if your loan application gets rejected, when you’re in need? and first of all, why can your online personal loan get rejected? There can be varied reasons that support your loan rejection and we list out some of the most common mistakes here. So, let’s try and understand where you might make mistakes while applying for a loan.
- Bad CIBIL history:
Your CIBIL scores can easily prevent you from getting an online personal loan. If ever you’ve defaulted on loan repayments, you will have negative remarks and a low credit score. This poor track record of yours can be a strong reason for banks and other lenders to reject your personal loan application.
- Not enough income:
Banks or lenders can’t approve your online personal loan application, if they find your income inadequate to sustain your monthly payments. Most of the lenders will have a minimum income limit, so make sure to check the personal loan eligibility criteria of your lender before applying for a personal loan online.
- Unreliable loan purpose:
Lenders will check whether you’ll be able to finance what you need with the loan you’re applying for. Many loans come with a restriction on how you use them. Like secured personal loans can only approve certain collateral, or car loans will have certain age limits and so on. So, make sure to check your personal loan eligibility before applying. If your lender finds out that your loan purpose is dubious, the chances of loan rejection are high.
- Incorrect details:
Remember that lenders will verify everything you provide in your personal loan online application. So, double check the information you provide before submitting your instant personal loan application. If the lender finds any inconsistency in your information, they will outrightly reject your loan application.
- Other loans:
Knee-deep loans? Then this might be a vital cause for your personal loan online rejection. If you hold several loans, your lender will check your income to debt ratio, and insufficient income will always lead to loan rejection.
- Over borrowing:
If you’ve borrowed too much previously, your lenders will term you credit hungry. Even if your credit score is clean or you meet their personal loan eligibility criteria, they consider you a risky candidate to lend money. So, borrow wisely.
- Unstable employment:
Lenders are always ultra-careful about your employment type. If you’ve an unstable employment or your income is insufficient, lenders might reject your personal loan application.
Given these points, there’s no complete guarantee that your personal loan application will get approved. However, if you avoid these mistakes, your chances of loan approval will increase. Keep this crisp checklist in mind while applying for a personal loan online – Check your eligibility, avoid multiple loans, maintain clean credit report, check your CIBIL Score. There’s no magic involved to get approved, but these ways will avoid the rejection pile.