Applying for a loan is easy, but it is not 100% certain that the bank or financial institution you are going to say yes. A large part will have to do with your profile: your income, your debts, your financial behavior, among other points, and also with the amount you are requesting as well as the documents you have submitted and how you supported it.
If, after all, the answer ends up being no, it is normal to feel discouraged and want to send everything to the bin. Total, if they already told you no, does it make sense to keep trying with the same bank or with someone else? It is also valid to get angry, since the denial of the loan means that you will not be able to meet the goal you were looking for, whether it is paying for a trip, taking a vacation, paying for your studies, among others.
But rather than taking this as an excuse to throw in the towel, it is better to look at it as a new motivation to correct certain aspects of your financial life and try again. With some changes, the next time you request it, you will definitely do better.
So what should you do? Take out pencil and paper and take note of these tips!
Ask for a reason
If you were denied the credit, you can consult the advisor who attended to you what were the reasons for the refusal. This will give you lights to see what small changes you can implement. Some entities even send you an email or a document explaining the reason for the rejection. Normally, it is common for loans to be denied when they exceed the person’s ability to pay or when it is not proven to have the necessary income to pay it.
Reduce your debts
If you have several active credit cards and one or more loans to pay, you will not be well seen before financial institutions, since your risk exposure is very high. Even if your income is very high, having so many debts shows that you are not managing your cash well.
So, something you can do is delete some cards or focus on canceling the loan you have active. Once your risk exposure is reduced, you will have a better chance of getting the loan approved.
Check if you are listed in ASNEF
You can request information from ASNEF to see in which situation you figure and if you have debts, try to pay them so that you disappear from the list. ASNEF is a data source that virtually all financial institutions consult.
Build your history
If you have never been related to credit, you have never had a credit card or applied for a loan before, it is normal for there to be uncertainty on the part of financial institutions, since they do not know if you are a good or bad payer and still represent a risk. What can you do? One of the easiest steps is to acquire a credit card. It does not mean that you will borrow, rather, the objective is to use it to make certain purchases that you would make in cash and pay it on time, so that you begin to demonstrate your good financial habits.
Increase your income
Something that also works is to look for alternative sources of income, so that you have a greater ability to pay.
Review the amount you are requesting
If you are asking for more money than you can afford, it is one of the reasons why they could have denied you the loan. So, ideally, analyze if that amount is what you really need and according to that, do your calculations to see if you can reduce the amount. Additionally, it will be very useful for you to know what your ability to pay is. How to know Add all your income and then lend it all the payments you must make. The remaining money, which is “free” is the one that represents what you could use to cancel the loan monthly.
Finally, try to have all the documents in order so that there is no inconvenience when submitting them and whoever reviews your application finds everything you need, without exceptions. The clearer the information, the faster it can be managed.