Maricor Bunal
If you haven’t heard yet, the Bangko Sentral ng Pilipinas (BSP) has recently updated its salary loan monitoring guidelines to upgrade the credit standard policies for this loan type. This means, consumers may face stricter evaluation from banks and other loan providers, delaying the approval rate, if not totally getting declined.
Have you been declined already? If you have, it might be wiser to take a look at some of the factors that usually cause banks to decline loan applications.
These are the five major causes to look into – you have to consider these before going to another provider to ensure you bag the loan you need:
Bad credit
BSP urges banks to implement a comprehensive evaluation of the borrower’s creditworthiness as shown in his or her bank statements, credit history and income streams. So if you have a bad credit record, it’s better to settle down your transactions first. You can also get a loan that will allow you to consolidate all your dues to pay all these easier and more conveniently.
Being unable to establish your capacity to pay
Loan providers always want assurance for their money. So make sure to present papers showing that you’re capable of repaying your credit. Collateral documents, payslips and bank statements showing multiple income streams are the best documents to show.
Not enough personal info
Identity is also a crucial factor that affects your approval rate. Apart from completing the application form thoroughly, submit additional documents showing your office and home contact details, address, citizenship and income sources.
Not having a backup plan
Assure banks that you have a backup plan to give them added security for their money. This will also reduce the likelihood of nonpayment. A common way tNot having a backup plan – Assure banks that you have a backup plan to give them added security for their money. This will also reduce the likelihood of nonpayment. A common way to do this is to apply with a co-borrower or guarantor. Should you miss to pay, the provider would require the guarantor to pay the loan in your behalf.o do this is to apply with a co-borrower or guarantor. Should you miss to pay, the provider would require the guarantor to pay the loan in your behalf.
Biting more than you can chew
Providers may also decline applicants who they think is borrowing more than they’re capable to pay. Again, this boils down to being unable to understand your limits and options, as well as not showing enough documents supporting your earning capacity. A good way to determine how much to borrow is to consult a loan expert. We at Loansolutions PH are committed to guiding people with their choice of loan products, helping you compare rates and facilitating your application. You can visit our site, loansolutions.ph, for informative tips or send us an email.
Banks and loan providers are tough people to court if you need money. But if you avoid the mistakes above, they’ll surely approve your application and release the cash you need.
