Getting Approved For A Personal Loan: 3 Tips That Can Help

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If you are hoping to be approved for a personal loan in the near future, you should know that there are things you can do to help improve your chances of getting the funding you seek. The three tips below can help you in accomplishing this goal.

Tip #1: Don't Close Long Standing Accounts

Many people take steps to improve their credit score before applying for personal loans in the hope that it will improve their chances of being approved. While this is a solid plan, some people will end up doing more harm than good when paying off old debts. This is because rather than keeping long-standing accounts active, individuals will pay off these debts and then close the account. This will shorten the overall life of your credit history and can negatively impact your credit score. If you are planning to pay off some of your old debts before applying for a personal loan, be sure to keep the account active so that you can benefit from a boost to your credit score while still maintaining a long credit history. 

Tip #2: Make Sure You Deposit Your Savings

It is quite common for people to keep some type of cash reserve on hand in case of emergency. Some people choose to stash their cash in a home safe or even under the mattress while others may store this cash in a safety deposit box or other secured location. Regardless of where you have been stashing your rainy day fund, you will want to make sure that these funds have been deposited into your savings or checking account before you apply for your loan. This is very important since lenders typically check an applicant's account balances to help determine how financially stable they are. The higher your balances are, the more likely you are to be approved for a personal loan. 

Tip #3: Don't Apply With Multiple Lenders

While it is always a good idea to shop around when considering personal loans, you will want to minimize the number of applications you submit. Many lenders offer a pre-qualification process that will allow you to get a clear picture of whether or not you will be approved for a loan and what your interest rate is expected to be based on the information you provide. The great part about this pre-qualification or pre-approval process is that it can be completed without performing a hard inquiry on your credit report. Since multiple inquiries can drop your credit score temporarily, it is important to avoid applying with multiple lenders. Instead, use the pre-approval process to narrow down your choices to the lender you prefer and then apply for a loan directly through that lender.

To learn more, contact a personal loan lender in your area such as Ardmore Finance.

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