However, sometimes, there is a possibility that you may possess an excellent credit score, yet you may not get a loan approval leaving you startled and wondering what may have gone wrong. To put it simply, the lenders have to look for their profit sources as well.
Therefore, despite having a good credit score, some factors may hamper your ability to get a loan from your lender. A comprehensive list has been compiled that explains as to why you may be unable to make the cut.
It goes without saying that short sales call for negotiation. However, this type of a negotiation does absolutely nothing to hamper your credit score. However, a short sale calls for you to pay an amount that is far lesser than the original amount owed by you. This itself can cause the lenders to be on their toes when you apply for a loan. Therefore, you should not be surprised if a lender refuses to support you financially because they will always have inkling that you may flake out on them and pay them much less than you owe based on your past experience.
When you pay a minimum amount but something that is of an acceptable standard it will cause absolutely no harm to your credit report. Therefore, it will have “pays as agreed” stamped on your credit report. While your report will look clean and acceptable, if a lender performs close background checks and comes across this flaw, he is likely to severe any professional relationship that may have had any kind of scope. The simple reason for this is the fact that minimum payments are an indication of underlying debt issues and no lender wants to be put on the spot in terms of debts and outstanding loan payments.
It is completely alright to have a few credit cards in your name. As long as you are good with your payments, your credit score cannot be harmed. However, lenders do not take too well to people who have a knack of opening credit cards in a rapid succession. Therefore, if you want to have easy and hassle free access to loans in the future avoid opening cards within weeks or even months apart. Lenders fear that although your credit score is currently decent enough, the scenario may change with the arrival of several credit cards. Therefore, they may refrain from giving you a loan despite a good and clean credit report.
You may do this out of good will and may extend a helping hand to a friend or family member in need but this in turn can jeopardise your own attempt at getting a loan at a future date. This is simply because of the fact that while you may be asked to pay off the loan for the person you have co-signed, you may find it increasingly difficult to pay off 2 loans at one time or in quick succession, thus decreasing your chances tenfold despite a good credit score.
Author’s bio:
Julianne Farmer is a finance analyst working with a well known financial firm. Her job requires her to do regular background checks and keeping in touch with investors and other management teams for the company. She likes to keep up with the stock market changes.
1.) Opting for short sales:
It goes without saying that short sales call for negotiation. However, this type of a negotiation does absolutely nothing to hamper your credit score. However, a short sale calls for you to pay an amount that is far lesser than the original amount owed by you. This itself can cause the lenders to be on their toes when you apply for a loan. Therefore, you should not be surprised if a lender refuses to support you financially because they will always have inkling that you may flake out on them and pay them much less than you owe based on your past experience.
2.) Paying the minimum acceptable amount:
When you pay a minimum amount but something that is of an acceptable standard it will cause absolutely no harm to your credit report. Therefore, it will have “pays as agreed” stamped on your credit report. While your report will look clean and acceptable, if a lender performs close background checks and comes across this flaw, he is likely to severe any professional relationship that may have had any kind of scope. The simple reason for this is the fact that minimum payments are an indication of underlying debt issues and no lender wants to be put on the spot in terms of debts and outstanding loan payments.
3.) Registering credit cards in a successive order:
It is completely alright to have a few credit cards in your name. As long as you are good with your payments, your credit score cannot be harmed. However, lenders do not take too well to people who have a knack of opening credit cards in a rapid succession. Therefore, if you want to have easy and hassle free access to loans in the future avoid opening cards within weeks or even months apart. Lenders fear that although your credit score is currently decent enough, the scenario may change with the arrival of several credit cards. Therefore, they may refrain from giving you a loan despite a good and clean credit report.
4.) Think twice before co-signing a loan:
You may do this out of good will and may extend a helping hand to a friend or family member in need but this in turn can jeopardise your own attempt at getting a loan at a future date. This is simply because of the fact that while you may be asked to pay off the loan for the person you have co-signed, you may find it increasingly difficult to pay off 2 loans at one time or in quick succession, thus decreasing your chances tenfold despite a good credit score.
Author’s bio:
Julianne Farmer is a finance analyst working with a well known financial firm. Her job requires her to do regular background checks and keeping in touch with investors and other management teams for the company. She likes to keep up with the stock market changes.
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