So you applied for a loan to further your studies and hopefully improve your financial income after graduation or you applied for a business loan so you could finally turn your dreams into reality. But getting a letter from the creditor explaining that you have been rejected can be disheartening. The first misstep is sending out more loan applications. After all, the more applications you send the more chances you have of getting one, right?
In this case, the motto to just keep on trying does not apply. In fact, it can damage your reputation and diminish your chances of getting granted a loan even more. So whatever you are thinking, stop and read on. Find out what you should do before apply for yet another loan application.
Learn from rejection
Find out why you have been rejected. If the creditor didn’t include any explanation in the rejection letter, although they should, contact an agent from the credit company and ask for the reason why. They should be able to tell you exactly what. If It is because of your credit report, there are many things that you can do to improve your credit report and score. And if it is, you are entitled to one free credit report.
Get a copy of your credit report and study it. Make sure that all information is correct, that all accounts are indeed yours, and all missed payments are true. If you find any errors, ask the agency that provided the creditor with your credit report to fix the error and update your records.
Double check your application form. Make sure that everything in the application form is true and correct. Be sure that you have included information about you that supports your ability to make payments on time.
Talk to your creditor
A late payment is one of the biggest factors that contribute to a low credit score. If you have missed a few payment deadlines but wish to improve your score, you can ask your creditor to erase the missed deadlines from your report in exchange for a full payment or an advance payment.
Have you been with your employer for five years now? Have you had your credit card for ten years? These are things that can increase your credit score so make sure that they are included in your credit report along with other information that can help prove that you are financially responsible.
One at a time
Many consumers apply to different loans all at the same time or in a short period of time. Make sure that you allow intervals between applications. Remember that all these applications and rejections for loans are reflected in your credit report. When a creditor sees that you have submitted many application forms in a short span of time, it raises a color guard of red flags.