Why banks refuse a loan, even with a good history

2024 Author: James Gerald | [email protected]. Last modified: 2024-01-07 21:53

Often, citizens are faced with a situation where they are denied a loan in all banks, even with a good credit history and salary. To understand why this is happening, it is worthwhile to figure out what factors bank employees pay attention to when considering applications.

Why all banks with a good credit history and salary are denied a loan

Refusal to lend from a bank can be caused by several reasons. Banks consider themselves entitled not to explain the reasons for their decisions, but there are several known patterns.

Specifying the purpose of the loan

Loans for consumer needs are readily approved. It is necessary to indicate the purpose of personal spending: travel, repair, purchase of office equipment. The so-called stop targets are discouraged:

• treatment;
• business development;
• refinancing loans.

Separate credit programs have been developed for them. So, business lending is carried out according to a special system, you need to apply for a targeted program. Special conditions have also been developed for refinancing. An application for a standard loan with such purposes will most likely be rejected.

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Specifying the details of the contact person

This is an important point for the approval of the application. It is necessary to warn the person who will be indicated as a contact person about a possible reconciliation of data. He must be aware of where he works, the applicant lives, he is solvent or not, etc.

If the bank's specialists call to inquire about a potential borrower, the information should sound clear and intelligible. The credentials should be spoken. Not passport, but general directions, right down to character traits, responsibility.

Delays in previous payments

If during the repayment of the previous loan there were delays of more than 30 days, the new loan may be refused. If during the year the interest on the loan was delayed 3 times or more, a new application may also be refused.

In this case, it is necessary to correct the credit history or post a collateral.

Try a different type of loan.

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Employer verification

Bank staff will review the main place of work. The data of not only the borrower, but also the employer is important. The business or organization where the applicant receives the main income must have existed for more than a year and have no tax arrears. The stages of liquidation or bankruptcy of the employing company will negatively affect the decision to disburse funds.

The head of the employer's enterprise must answer the call from the bank, confirm the borrower's place of work, and provide the information necessary to the bank.

The employing company must be solvent and not have increased risks.

Indication of additional income

Often, citizens indicate the main income from a permanent job or the main type of activity, but do not enter information about additional earnings. This can be the provision of services outside working hours: for example, cosmetology, cargo transportation, private consultations. You can get additional income from the rental of residential or non-residential premises, a car for rent.

You can have an official source of additional income: part-time work, a second job, receiving interest on a deposit. Even if the income is insignificant, then, when filling out a questionnaire at the bank, it is worth indicating all such sources of funds, since this can serve as a confirmation of solvency. Bank specialists can take into account the amount of additional income when calculating the loan amount.

How banks consider applications

When issuing a loan up to 50 thousand rubles. banks consider applications automatically. A computer program analyzes the borrower's profile and assigns points for each section of the application. The scoring program takes into account:

• borrower gender;
• age;
• place of residence and work;
• work experience at the last enterprise;
• the size of the salary.

For example, the age of the borrower 18-20 years old is assigned 8 points. At the age of 35, the scores increase to 40. And so on for each parameter. An automatic application is approved when a certain threshold of points is reached. If the accumulated points are not enough, the loan is denied.

When the amount of the requested loan exceeds 50 thousand rubles, the bank's loan officer is connected. All information received is carefully checked. The presence of credit obligations to other organizations can also serve as a reason for refusal.

Loan payments should not exceed 50% of the salary.

When evaluating a borrower, bank employees will consider payment discipline. Non-bank debts will also affect the decision to issue a loan. These can be unpaid utility bills, alimony debts, taxes.

Lack of credit history and age from 18 to 21 also influence the decision to grant a loan. Most likely, such an application will be refused.

Each credit institution has its own minimum requirements for customers. Non-compliance with the bank's standard requirements can also influence the decision.

What you need to do to improve the chances of your application being approved:

• indicate reliable information;
• write a statement without errors and corrections;
• do not ask for too much amount;
• pay utility bills before applying.

The bank's minimum requirements can be found on the organization's website. A complete package of documents should be collected in paper form and be at hand. The presence of a bank card to which funds are received will play a positive role in the approval of the application.

Outcomes

There are five main reasons why all banks with a good credit history and salary are denied a loan. In case of difficulties with obtaining a loan, you can seek advice from specialists, or you can try to apply again, correcting the shortcomings.