Many borrowers are baffled when their loan application is declined by a lender. Most lenders will not provide a reason leaving the applicant with no clues as to where to look. If you have found yourself in this situation, there are things that you can do to clarify your situation.
1. Can you afford the loan you are applying for?
If you have just made an application for a car loan , a personal loan or a home loan, it may well be that your income is not sufficient in the eyes of the lender to qualify you for the loan. You can run your scenario through a “how much can I borrow” calculator online to see even approximately if your income is enough to qualify you for the loan;
2. Do you have some bad credit history or excessive loan inquiries?
You can perform your own credit check online for free to see what a potential lender sees when you make a loan application.
www.mycreditfile.com.au is the site to visit for a free credit check.
Note that if you approach others to run a credit check on your behalf it may adversely affect your chances of qualifying for a loan. Most lenders will decline an application if you have unpaid defaults. judgements, bankruptcy or even too many loan inquiries on your credit report.
Bad credit should not prevent you from qualifying for a secured loan but you will need to approach second tier lenders – your banks is unlikely to accept such a loan application.
3. Have no financials to substantiate your income?
While you may qualify for a low doc home loan or a low doc car loan, there is no such product as a low doc personal loan.
Therefore if you have some bad credit, and you are looking for an unsecured bad credit low doc personal loan – unfortunately such loans simply do not exist.