In recent times there are situations when after filing banks refuse to issue credit. Moreover, credit institutions are not obliged to give reasons for their decisions. The result of those who really need, tries to understand why banks refuse to loan. It is also important not only to understand the reasons for negative decisions, but also to try to change the situation in their favor.
TOP 10 reasons why denied credit
Can I know why denied credit? With absolute certainty the cause impossible. The situation should be examined for each individual separately, analyzing its personal settings. However, there are several basic circumstances that can cause failure in the Bank loan.
- Age. Despite the fact that some banks in the conditions indicate that grant loans to persons since 18 years, they are in no hurry to do that. The reason is simple enough: young people often lack stability in life, they can be not serious enough. In addition, it is likely that men under a certain age can be called to service. The easiest youth to obtain the credit with pledge of property. For example, if you have sufficient income, they may be issued a mortgage or a car loan.
- A bad credit history. It’s simple, if the potential borrower has previously borrowed and did not pay them on time, the Bank will classify them as high risk of default. To get a decent amount in the debt in this case will be difficult. Will have to use various ways of correcting credit history.
- The lack of credit history. Often denied credit for a large sum, and in the absence of credit history. The Bank can not find out how responsible the applicant will apply to payments on a loan. Those who have never taken out a loan before, better to start with small amounts.
- Fake documents and information. Today see the announcement of the proposal to prepare such can at every step. The borrower will issue a certificate and employment. You should not resort to such services in any case. Credit organizations can easily recognize the use of such schemes. In the best case you follow just the Bank’s refusal, in the worst case for forgery can be brought to criminal responsibility.
- The lack of income. Even those who have, it would seem. Large income before you apply for a large amount, you should use a loan calculator. Of course, each Bank has its own method of calculation. But it is unlikely that the applicant will approve a loan. If the payment amount is more than half of the monthly income less mandatory payments. It is also important to consider the presence of dependents, other loans, category housing (own or rented).
- A large number of acting credits. Many banks will accept for the maximum number of open loans 3-4. If there is more than likely a borrower takes out loans aimlessly without thinking. Such borrowers often complain that they were denied refinancing.
- The work of the individual entrepreneur. Many banks consider small business unreliable. Therefore, applicants who work for a company that will be attributed to borrowers with a high risk of losing the monthly income.
- The lack of a landline phone. Many lending institutions require that such was at home or at work. If not specified, can not issue a consumer loan. To avoid failure, it is important to take care of the rooms in advance. The Bank should come with a list of phone numbers of friends and acquaintances (not cellular), office of the employer, the accounting Department, supervisor.
- The existence of a criminal record. Often answer questions haunt those who have ever had a criminal record. This applies even to those who have it already removed. Very rarely, the security personnel do not pay attention to conditional criminal record, and the resulting domestic crimes.
- In different banks the borrower has various data on place of work and income. The fact that the staff, checking applications, often comparing them with the information that was provided to other banks. If it is different, likely the data is unreliable. To protect yourself in the loan denied.
What to do if refused a loan in all banks
Many want to know why denied credit. As mentioned above, asking the credit company is answer to fail. However, there are two ways that will help to do this.
The first option is independent work. First of all, you should request your credit history to various credit Bureau. Next, carefully analyze it. There are situations when the loan closed a long time ago, and in the file it’s not listed, or worse, delinquencies and credit history they are. If there are errors, you can safely apply to the KJV. You will need to write a statement and attach supporting documents – copies of pay stubs, receipts, a certificate of repayment of the debt from the Bank.
The second option is the assistance of professional credit brokers. They analyze the borrower in the same ways as banks. Such organizations not only tells in detail why denied credit, but will give advice on how to rectify the situation.
5 tips when you are denied credit
If the borrower was denied the loan, all is not lost. Experts give some tips on how to still get the coveted money.
- Should apply to all available banks. This is most easily done with the help of Internet sites. This way you can increase the probability of approval.
- If it is known that banks are failing because of bad credit history, you should try to fix it. It will take a lot of effort and time, but often it is necessary.
- If it is not clear why banks do not give credit, you can try to take a loan secured by the property. Such applications are approved much more readily.
- It should again calculate the maximum loan payment. At the same time of salary you need to deduct all mandatory fees, a living wage (including for dependents). The resulting amount shall not be less than the planned payment, and ideally half. If this condition is not fulfilled, is to reduce the amount of the loan.
- In a pinch, if you need a small amount for a couple of weeks. you can contact the microfinance organization. They approve loans to all. But do not forget. What interest rate they are very large.
Finally, we note that many do not understand why banks offer the loans, and then failing. The answer is simple – all offers are a common promotional moves. During their distribution, the borrower does not subsequently, when contacting the Bank and submitting documents to the waiver. To avoid this, is to use the tips given in this article.