6 Tips for Improving Your Chances of Being Accepted for a Loan

Getting turned down for a loan can be devastating, especially if that was for an urgent expense. It’s easy for someone who has been rejected repeatedly to fall into despair, and it’s perfectly understandable. However, this doesn’t mean that the fight is over. No matter who you are, there are some steps that anyone can take to make themselves more attractive to potential lenders. Some of these require little to no effort too. Let’s take a look at how you can improve your chances of getting accepted for a loan.

Get a Copy of Your Credit Report

The very first thing you have to do is order a copy of your credit report. Every UK citizen is entitled to a copy of their credit report from the top 3 credit reporting agencies – TransUnion, Equifax, and Experian, for free. This will allow you to get a real view of what your credit situation is.

You might notice that some account that was closed long ago is still active on your credit report, for instance. Errors like these can happen, and make a huge difference to your score. If you notice one, there is a simple procedure to follow with each agency and you shouldn’t have issues getting any false entry removed.

Another thing you should do is check the accounts that you could settle, contact them, and try to strike an arrangement. You could get a good portion of the debt reduced if you agree to pay in a few payments.

Start Improving Your Credit

There are tons of other ways that you can improve your credit starting today. One would be to join the electoral roll. This is because it will usually be used by lenders to verify your account. You should also be careful with the number of applications you make in a short period as multiple enquiries on your credit report will further damage your credit. 

If you want to learn more tricks like these, we suggest you check out this piece by New Horizons. They’re a broker team that helps people get loans for bad credit scores. They show a few techniques you can use to fix your bad credit score fast. They also speak on the consequences of bad credit, and how credit is actually rated. 

Cut Connections with Bad Borrowers

You should also check whether you’re connected with someone who’s considered a bad borrower. For instance, your partner might not be as responsible as you and they could be ruining your credit without you realising it. If the both of you share financial products, then you are connected and their credit history will affect yours, so be mindful of that.

On the other hand, there are also things that you can do to show that you do not have any relationship with that person. This can be done by contacting credit agencies and lodging a “notice of dissociation”.

Look for Alternative Lenders

Know that you don’t necessarily have to go through a traditional lender to get a loan. Banks tend to be very rigid, and will be very picky with whom and for what they will lend money. This is why you should consider alternative lenders if you can’t get a loan through your local bank. Brokers can be an option as they will be able to connect you with lenders who are more likely to approve you. 

You could also go with instalment loans. Many will rely on your income to judge whether you’re creditworthy or not. These can have very high fees, so that’s something you’ll have to be careful with. However, they could be the last resort for some people, so these could always be considered.

Have Your Documents Ready

Also, make sure that you come prepared when applying. Make sure that you have all the documents on hand. If one or two are missing, it could be all that’s needed for them to reject it. So, don’t get rejected out of neglect and make sure that you have everything you need and more.

Check for Eligibility Before You Apply

We talked about not making multiple applications at once earlier, but what can you do instead? Well, one of the things you could do is use soft search technology. There are plenty of eligibility calculators out there that use it, which will allow you to get an idea of whether you have an actual chance of getting accepted for a particular loan without triggering an enquiry with the credit agency. They will often usually propose alternatives you could use instead. 

These are just some of the ways that you can improve your chances of getting a loan. Make sure that you follow those to the letter, and do whatever it takes to turn your situation around starting today.