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Tips for easy loan approval

Loans have paved ways for many people to enjoy a lot of expensive things. If it was not for loans a lot of people will not be able to own things like homes, cars, bikes and many others. There are no second thoughts on the fact that it has made lives better.

There are no doubts about the fact that loans are great. But we also need to accept the bitter truth that it is not an easy thing to get loans. There are a lot of parameters that are considered by the banks to give loans. In this article, we will see some tips for easy loan approvals.

Check and improve your credit score

Applying for a loan without knowing the credit score is definitely the stupidest thing that one can do. If your score is good, then there will not be any issues, but if you have a bad credit score, there are good possibilities that your loan application will be rejected. So make sure that you check the credit card score before applying for a loan. If it is low, take the necessary steps to improve it, and your loan will be approved easily.

Six-month rule

When you are applying for loans, it is important that you should not have applied any loan six months prior to it. The reason is very much evident. If you are handling two repayments at the same time, there are possibilities that you might not pay the EMIs perfectly. Hence the lenders will be a bit hesitant to lend you any kind of money. So it better to leave a gap of a minimum of six months from one loan to the other. It increases the possibility of the loan being approved.

Good Credit

The 30% rule

When you are applying for the loans, make it a point to put 30% of your monthly income in the EMIs. If you are mentioning this particular point in your loan application, there are good possibilities that your loan will be approved. It is because it will create a good impression of the approval officers. Creating a positive impact in their minds plays a major role in loan approval. It is more like getting the king’s consent. 30% is just the minimum value. If possible, you can also increase the percentage. Make sure that it does not affect your monthly expenses.

Have a mix

If you are a person who is constantly taking loans, then it is important to mix the type of loans. You need to take both secured loans and unsecured loans. The secured loans are the ones in which the collateral is provided. The unsecured loans are the ones where there is no collateral. If there is a mix of both the loans, it will have a considerable impact on the credit score, and hence it will improve the chances of loan approval.

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