Reasons of getting rejections on small Personal Loan Applications
Reasons of getting rejections on small Personal Loan Applications
During hard times, Small personal loans are an excellent source of relief in financial crisis. Applying for any small personal loan is quick, easy, fast, and generally characterized by a high success rate. However, there are some situations where small personal loan applications get rejected. If someone is looking for applying for a small personal loan, one should always search for an online lender as there is a streamlined process that requires minimal documentation to increase the chances of getting the loan approved successfully. Few reasons for loan rejection are as below:
- Multiple Enquiries makes your case weaker.
Every time a person applies for a loan, the lender makes enquires about their credit score. Multiple enquires in a very short period indicate that the individual is under financial stress. This gives the negative effect of discouraging any lending institutions from extending a small loan to the person. If you’re willing to get a small loan, it is advisable to apply to only one lender so the chances of getting loan approval increase, and the loan will get disbursed without affecting your credit score.
- 2. Low Credit Score is a deterrent to an availing a personal loan
A low credit score signifies a person’s bad credit history in past and reduces the chances of availing of an affordable loan. A low credit score indicates poor repayment history or credit defaults in past. Maintaining a healthy credit score is essential to avail of small personal loans, credit cards, or any other types of loans.
- Incomplete Documents
It is mandatory to submit all necessary documents when applying for any kind of loan from any Online Application or portal. Missing out on any important documents like salary slips or ID proof can lead to rejection of the application.
- Low Salary makes it a bit tough to secure loan of high amounts
Low-income salary is usually an indication of low repayment capacity. If a person’s loan requirement is higher than their estimated repayment power, it is difficult for the lenders to take any kind of decision, and approval of such type of loan might not be possible.
- 5. High Credit Utilization
In times of distress, maintaining a healthy utilization of credit is very critical to avail of loans. It is advisable to repay your loans on time. Applicants with an existing floan are less likely to get loan approval, especially if the total loan value crosses 90 percent of their borrowing capacity.
wefin is an online one-stop solution platform for instant loans to meet your requirements. Here you can check your credit score and apply for personal loans by submitting your details online in a 100% paperless manner. Your details are assessed by our partner banks and NBFCs and you get an instant personalized loan offer that various bank wish to offer you as per your credit score. Adopting an online way of getting a loan has never been easier, But jab Loan Mile Yun, toh Tension Leni kyun! jab he wefin.