Did you ever apply for a personal loan and you got your personal loan rejected? If yes, then must read this post so that in future this never happens with you. There are certain reasons due to which the loan application is rejected. We bring here the “Top 10 Reasons For Rejection Of Your Personal Loan” with their compliance. Now let’s discuss these points one by one. For more details of personal loan you must visit our page on Personal Loan
Top 10 Reasons For Why Was Your Personal Loan Rejected
- Low CIBIL Score- Healthy CIBIL Score (above 750 points) is the first condition of approval of your personal loan. In case you defaulted any loan or credit card outstanding earlier then just cover them up and maintain a healthy CIBIL Score.
- Bad Credit History- Your credit history says all about your repayment behavior. Default in repayments ruins your credit. If you ever go settlement of your credit cards or loan accounts then they submit this report to CIBIL. This results downgrading of your credit history. Bad credit history is the one of the top reason for your personal loan rejected.
- Insufficient Income- If you have good income then only lenders will sanction you the loan. Less or insufficient income is a hurdle for getting any loan. Like Minimum salary of Rs. 15000-Rs. 20000 is condition of getting Credit cards, personal loan. If your income is above Rs. 25000-Rs. 30000 then only you will get the home loan. This is because the lenders and bank look for for surety of their loan repayment and recovery of loan amount.
- Unstable income and residence- Unstable income means no fixed monthly, quarterly or annual income. When you are in job for regular period then your salary per month fixed. When you are not in job for more than 2-3 months your income status is unstable. Similarly when you are in business with no fixed turnover and revenue then your income is unstable. Same is applicable for the clause of residence also. When you change your residence frequently i.e 1-2 times in a year then is not stable. These conditions make your loan application challenging to get approved for loan amounts. You must avoid these if you are planning to take loans in near future.
- Address Verification Issues- Once you have applied for personal loan then the lender or banks does your address verification. Your residence address and official address both are verified. If these are not verified then you get the personal loan rejected and approval is not done.
- Document Verification Issues- Documents submitted by you are thoroughly audited by the auditors of bank or lenders. So, when your documents mismatch or their authenticity is not proven then loan approval is not done.
- Loan Cap limit over- Loan cap or limit depends on your income, repayment capacity, earlier loan running, total EMI being paid per month and other similar factors. Like if your salary is Rs. 30000 then you can get loan loan upto 3.5 Lakhs. Your EMI contribution is 50% of your monthly income. Thus maximum EMI you pay should not exceed 15000 per month. Once you cross the limit cap due to any reason, it is difficult to get any further personal loan approval.
- Signature Mismatch- This is one the common reason for delay or not getting the approval of your loan application. However lenders cooperate you to get this error rectified. Specially signature in the PAN and Bank mismatch is taken care of. ECS forms should also be signed properly. Now a days many loan agents do collect soft copies on whatsapp or email and submit documents of customers signing duplicate signatures of customers.
- Loan purpose not as per norms- For personal loan no one ask you what you do with money taken as loan. However the lenders and bank ask this to you during verification process. This is done to insure than no illegal activity is done from this money.
- Incorrect Details submitted- At last but not the least, the details submit in loan application should be correct and up to the mark. Many times we try to hide the details. We knowingly or unknowingly mismatch the income figures, loan EMI and loan details are wrongly given. This should not happen. This may be one the reason if your loan application is rejected.
We at Loan Guru advise you to take care of all 10 points given above. This will prevent your personal loan application getting rejected. Even if your loan application is rejected, please submit your query then our loan experts shall get back to you and will resolve the issues.