From buying a new car and going on an exotic holiday to improving your home and organizing big and luxurious events like a wedding, there are many reasons why you may want to take a personal loan. However, getting a personal loan is not such an easy task. Given that we live in the times when economic troubles can happen overnight, lenders are becoming more strict and are looking for a lot more in an applicant. When applying for a personal loan, many things are assessed, right down to your postal code. While nobody, not even a credit provider can tell you whether you will be successful, we have done a small research that should give you a better insight into what you should do to get your personal loan approved.
Make sure you meet the criteria
There are a few things you need to check before even considering to apply for a personal loan:
– Be at least 18 years old
– meet minimum income requirements
– be employed or receive regular income
– not be going through the process of bankruptcy
– have a good credit rating
Start searching for the right loan and once you find the loan package you are most interested in, contact the bank directly to find out all the details about it as well as all the requirements. The best way to do that is to make an appointment in person with a loan provider. With them, you can discuss all the details from the necessary documents and materials to the timeline you will need to start your application process. Most importantly, you will find out all the requirements for loan eligibility. Banks have different requirements and it is always good to know what to expect so you can be prepared upfront.
Improve your credit rating
In today’s world, many reference agencies hold on file about your financial behavior. That’s why it’s always better to make sure your credit rating is as good as it can possibly before you start the process of applying. First, you need to check your credit file. Next, you need to do everything you can to improve your credit rating such as:
– make sure your personal details are correct and that all the information is updated
– make sure you recognize all the present financial accounts and that you are the only one responsible for them
If you do these things, you will make a vast difference to your credit report
Have the right expectations
No matter how fast you need a loan, make sure you never apply for it in a hurry. There is a certain protocol you must go through before you get the loan. It’s always a good idea to discuss all the steps of the process in order to be fully aware of what to expect and in order to have an idea how long it will take you to reach your goal. You may also need to outline the reasoning behind the loan. For instance, the lender might want to know how you will use the loan (for home improvements or debt reduction). Also, keep in mind that it can be highly dangerous if you continually apply for any loan you think you may be able to get. This can obliterate your chances of getting one loan in the near future.
Consider your stability
There are few things loan lenders will always check before they even consider giving you a loan. If you have been with your employer for two or three years and if you can show the stability of residence, your application for a loan will be viewed favorably.
However, there are always things you can do to make your position more stable:
- Commission salary – Get a letter from your employer outlining what your expected salary and commission is.
- Apprenticeship – if you are close to the end of your apprenticeship, but will be kept on full time, getting a letter from your employer stating that will be helpful.
- Self-employed – show last years business activity statement as a benchmark of your annual earnings