Get Approved with These Personal Loan Tips
December 10, 2018 | By Louis Tully
When it comes to getting approved for a personal loan, there’s no ‘one way’ about it. Though your credit score and income are two key components in the approval process, there are several other considerations that may come into play too. For example, most lenders will look at other variables such as your debt-to-income ratio and whether or not you’ve come prepared with someone to co-sign.
The Best Personal Loan Tips Getting Approved
Before speaking to any lender about the possibility for a loan approval, it’s important to keep this in mind; lenders only lend to those who they can trust. So before you go asking for a personal loan, it’s important to give them a reason (or reasons) to trust you. How does one accomplish this? These personal loan tips can help you get there:
Maximize Your Credit Score
As mentioned, your credit score is a major factor that most lenders will look at closely before deciding to approve you for a loan. The credit rule is very simple; the higher your score, the higher your chances of getting approved. These days, you can make sure that your credit score is on the up and up with apps like Credit Karma and Credit Sesame. Thanks to apps like these, knowing where you stand with your credit and learning about how you can improve it is not only easy, it’s free!
Checking your score doesn’t lower it either, not even by a point. So feel free to check it anytime, anywhere. Want to know how you can maximize your credit score? Try some of these tips:
- Check your credit report for any hiccups or errors.
- Stop using your credit cards.
- Make sure ALL of your payments are on time, every time.
Eliminate Some Debt
Technically there’s two parts to this one: in order to position yourself for a much better chance at getting approved, you’ll want to find a way to increase your income, while decreasing your debt at the same time. This will improve your debt-to-income ratio, a significant factor most lenders will look at before considering you for a loan approval.
This can easily be accomplished by taking on a part-time job or a side hustle. A side-hustle doesn’t have to be an excruciating endeavor and you could do it on your own time. For example, you could turn one of your favorite hobbies into a cash-making effort with ease. Explore some of these popular side hustles:
- Like to drive? Try driving for Uber or Lyft.
- Are you into arts and crafts? Consider selling some of your creations on Etsy.
- Play an instrument? Try playing in a cover band or give private lessons on your free time.
By pursuing any of the above side-hustles, you could easily boost your income while using that extra cash to pay down any debts you owe.
Take Out a Personal Loan for Only What You Need
Many professionals agree, asking for too much is seen as risky by most lenders. If you want to increase your chances of getting your personal loan approved, ask only for what you need to reach your financial goal.
Not sure how much to ask for? Simply look at your financial situation and ask yourself, “How much money do I need to fix this?” Take some time to work out the math if you have to, but it shouldn’t be too difficult to come up with a number that works for your situation.
Ask a Friend or Family Member to Co-Sign
Okay, so maybe your credit history isn’t up to snuff and the lender seems ready to turn to turn you down. The good news here is that you may have one more option available that could be a complete game changer; a co-signer. Just because your credit and income aren’t enough to get you a loan doesn’t mean all hope is lost.
If you know a friend or a family member who’s willing to help (and whose credit and income are in ship shape), you could still easily get approved for your personal loan after all! The catch? If you fail to make your payments back on time, your co-signer friend will get dragged down with you. That’s because once they co-sign on the loan agreement, they are equally responsible for the loan payments as you are. So, in other words, be sure that both of you know the risks involved before signing the loan agreement and be sure that the two of you have worked out a plan to get the payments paid on time.
Choosing the Right Lender for Online Installment Loans
Many online lenders will disclose all the information you need to make an informed decision. Everything from credit requirements to whether or not they allow for a co-signer is generally addressed on their website.
Use this information to decide if a lender is right for you and if you it’s worth giving their personal loan application a shot. But if all else fails, you could also consider online installment loans as an alternative. Installment loan requirements aren’t nearly as harsh as traditional lenders and you could get approved for same-day cash in as little as 30 minutes! For information about installment loans and how they work, please speak to a lender near you today.