Why Personal Loans are Rejected with Good Credit Score

• Insufficient Income– Along with many other criteria which ensure a
person’s creditworthiness, income is also one of them. Every lender keeps
a criterion of a minimum income below which they don’t grant a loan.
Though your credit score is excellent, your loan can be rejected if your
cash flow is less than the minimum income line mentioned by the lender.
• Unstable Income Source– Along with income, lenders check the
employer of salaried persons and the business stability of self-employed
persons to check the regularity of income. A stable and regular income
source is a must to repay the loan on time. If the lender is not satisfied with
the source of income of the applicant, the loan application can be rejected.
• Files Bankruptcy In Past– Bankruptcy is a situation when a person
declares that he is unable to pay his debts. Hence banks take action such
as liquefying his assets to recover the lent money. If a person files a
bankruptcy, this action of him will be recorded on his credit report. So any
lender will know this fact while checking his credit history. Such records
can make lenders reject a loan application.
• Loan Rejection in Past– A loan application rejected before can act as the
reason for getting the next application too rejected. A frequent loan
application shows a credit hungry behavior of an applicant. When a lender
gets to know that his previous loan applications are rejected, he becomes
more conscious and this may result in rejection too.
• Mistakes On The Application– One must be very careful while filling the
loan application form. Any mistakes in the application or any wrong
information in the application can make the lender reject the application.
Whether it may be an online personal loan application or a conventional
one, one has to provide the genuine information without which a loan can
be rejected.