If you have been denied a loan by your bank, you may want to try another one. Each bank has its own lending criteria, and if you’ve been rejected by one, you may be able to find a more lenient bank if you apply elsewhere.
You could also try a rural or regional co-operative bank, which may have less stringent criteria than your home bank.
Unsecured personal loans are difficult to get
If you have poor credit and need cash fast, you may find it difficult to qualify for a personal loan without collateral. Although unsecured personal loans are available, you will have fewer options and likely pay higher interest rates.
To find the best loan, learn about your credit score and what it means to have bad credit. If your credit score is low, get a co-signer for the loan. However, you should avoid multiple loan applications within a week.
Using more than one application will drag your score down even further. This can also cause more hard inquiries on your credit score, which will hurt your score even more.
Another reason why unsecured personal loans are difficult to get is because there is no collateral to offer lenders. Lenders see it as riskier and may be less likely to offer lower interest rates on unsecured loans.
Also, borrowers with poor credit are more likely to default on unsecured loans, which can hurt their credit score and make it more difficult to get new credit. However, unsecured personal loans can be beneficial if you are careful how you apply for them.
Income requirements for getting a loan from a bank
Lenders want to see that you can repay a loan, which is why they often require you to provide proof of your current income.
This can come in the form of a P60 or pay stub. If you are self-employed, you may have to prove your income by providing tax returns or bank statements.
Applicants who are unemployed need to show a history of steady income, nomatter where it comes from. This can include pensions, retirement accounts, and government benefits. Some lenders even offer loans to unemployed people if they have a part-time job.
While most lenders don’t disclose minimum income requirements, they generally require a borrower to have a steady source of income and a good credit score.
If you are self-employed, gather up your last two year’s accounts and other financial documents to show your income. If you have any assets, your bank account balances should be large enough to cover the loan. If you have any assets, your income should be large enough to pay the loan.
Problems with getting a personal loan from a bank
When you apply for a personal loan, the bank may ask for collateral, including a savings account or property. If you do not repay the loan within the set time, the lender may take your collateral to satisfy your debt.
There are many other options for a personal loan, including online lenders and credit unions. If you have been declined a personal loan in the past, you can address these issues before you apply for one.