5 Reasons Behind Your Loan Rejection
Loan rejection can be due to many ways and in order to understand why your loan rejection happened, you need to first understand what does a loan means.
A loan is a form of debt incurred by an entity or an individual. The lender is usually a financial institution, corporation, or government—advances a sum of money to the borrower. In return, the borrower also agrees to a certain set of terms including any, interest, repayment date, finance charges, and other conditions.
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Due to certain factors, your loan can get rejected. Some of these factors are mentioned below:
Changing job frequently: If you change your job constantly than it is a sign for the lender that you may not pay off your dues in an appropriate time, because of the job instability
Poor Credit History or Credit Score: Not paying a loan EMIs or your existing Credit card bills or any other default in payment can get your CIBIL score lower and you will have a poor credit history which will make the lender reject your loan application because of bad track record.
Low level of income to pay off debt: If you do not have enough income to pay your EMIs of the loan than you have bleak chances of getting a loan. So, make sure you have a minimum income requirement by the bank.
Wrong details filled in the loan application: Lack of information or wrong information filled can also lead to rejection of loan application, also you need to submit required documents to the bank manager.
Rejection of previous applications: If any of your previous loan applications got rejected due to any reason, it gets recorded on the credit report of yours. Previous loan rejection can also act as a barrier to getting a loan.
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Special Note: An individual must examine the whole EMI amount payable to the lender with the Personal loan EMI calculator.