A personal loan is a flexible way to access money when you need it, whether it’s for school fees, auto repair, vacation or those unexpected expenses life is throwing your way. Personal loan approval is usually quick; however, there are some steps you can take to make sure you get approved for a loan at a favorable interest rate. Here’s what will help you get approved when you need fast cash.
Check Your Credit Score
Any lender will check your credit score before they authorize your loan. While you can still get approved with bad credit, it pays to have good credit. The better your score, the more favorable loan terms you may receive.
Check for inaccuracies on your credit report and dispute them. One in four credit reports contains errors, so you never know what you can find.
Pay Down Your Debt
To have a good credit score, you must pay your bills on time and pay down your debt. If you’re trying to get out from under debt, start by making the minimum debt payments on or before the due date. Stop borrowing money, so you don’t take on additional debt.
Once you’ve mastered these steps, put more money toward your debt. This lowers the amount of debt you’re carrying, which bumps up your credit score.
This can make you a better loan candidate and also helps you get a lower interest rate. While it might not be possible to make progress on debts before taking out an emergency loan, this is a good habit to adopt throughout your life.
Understand What You Need to Borrow
Before you complete a single loan application, figure out how much money you really need to borrow. Look at your bills, tuition statements or the existing debts you hope to refinance. Do the math and only take out what you need to borrow – nothing extra.
From a lender’s perspective, it’s less risky to loan a smaller amount of money than a larger amount of money. By being honest about your needs and not taking out extra cash, you make your application more attractive.
Smaller loan amounts not only increase the odds of a fast loan approval, they also protect your financial future. The less you borrow, the less you need to repay – and the less interest your loan generates.
Shop for Lenders
There are reputable financial companies out there, but there are also predatory lenders who take advantage of people in times of need. Ask for referrals from friends and family who have valid experience with a lender. Then look up any lenders you’re considering to make sure there are no consumer complaints. The U.S. Consumer Financial Protection Bureau lists consumer complaints about banks, so that’s a good place to start.
Personal loan companies vary widely, so it’s always important to do your research and make sure you feel comfortable before you sign any loan paperwork. Time Financing Service ® has over 50 years in the personal lending business, and we are a trusted provider throughout central and eastern North Carolina.