Five Sure-Fire Tips to Get your Loan Approved by Any Lender
Applying for a loan can be a nail-biting process. Will it be approved, or will you have to face the disappointment of rejection? Here are a few sure-fire tips that help you land any loan without difficulties!
Getting a loan sanctioned by a lender is not the easiest of all processes. Considering the current turbulent economy all over the country, financial institutions are taking a closer look at the applicants and have imposed strict laws as to who receives a loan and who gets denied.
While the specific rules vary from one lender to another, there are a few critical parameters that remain the same across the board. Make sure to follow the tips listed here to ensure that your loan application gets sanctioned without any hiccups.
#1: Start by Saving
While this may seem counter-intuitive to the very purpose of a loan, having enough money to pay for a down payment increases your chances of success. This is very true in the case of a New Home Loan. When you apply for a home loan, your lender gives you only 70-80% of the property’s value. The rest you have to fund from your pocket.
When a lender sees that you can afford down payment, they are likely to lend you the loan at better rates.
#2: Decide on What You Want
Are you looking for a particular loan product? What’s the ideal tenure that works for you? How much EMI can you afford?
These are a few questions that you must ask yourself before approaching your lender. It’s not necessary that you should know A-Z about the loan process and products. However, knowing what you need and what you can afford improves your chances. Lenders see that you’re committed and are likely to approve your loan application.
#3: Stay on your Job
As a loan applicant, you have to provide details of your work history. The general rule of thumb here is that you must have a record of at least two years of working with your current employer.
However, if you don’t have two years of experience in your current job, you needn’t worry. You have to prepare documents supporting your prior employment track records.
Lenders want to know that you have a steady job and will be able to pay off the loan without defaulting. So, a good employment history and track record go a long way in ensuring the success of your loan application.
If you’re an entrepreneur or are self-employed, make sure to provide all the details, regarding your business to improve your chances.
#4: Be Aware of your Personal Credit History
All lenders will look at your credit history before they can approve your loan product, be it an unsecured loan like a personal loan or a secured loan like car loan. They are bound to ask questions about your credit status and history.
So, make a list of the expected questions and prepare satisfactory responses. Be sure to explain any information that doesn’t present you in the most favourable light.
#5: Get your Paperwork in Order
One of the biggest hang-ups for loan applications is incomplete paperwork. Make sure that you have all documents to avoid unnecessary complications. Ask around, check with other borrowers, or use online checklists to find the list of documents that are required by a lender. Having them on hand simplifies the process and reduces application approval time.
A successful applicant does his/her homework. Spend your time on research and make a list of all the choices that are available to you. Also, try to improve your profile as a borrower. Pay off the pending bills and close other loans before you opt for a new one.
Above all, finding the right lender who fits your needs is half the battle done. Shop around till you find the perfect lender who offers you the best loan at attractive rates.