4 Major Reasons for your debt consolidation loan application rejection Debt consolidation loan is a process of combining multiple credit card loans into a single loan with lower interest. Debt consolidation makes you pay down your debt faster and helps in boosting your credit score and sorts out one time easy payment. This could be a solution for debts but unfortunately, you may get rejected in getting debt consolidation loans. Below listed are some reasons why your loan application is getting rejected.
Credit score Credit scores are the indicators of how you have handled your previous loans. Credit scores are the important factors in providing loans, maintaining a low credit score can be the reason for your loan rejection. If your debt-to-income ratio is negative, it will affect your credit score. Also act on if there are irregular payments of your previous loan. Low credit scores can’t be quickly corrected but it can be prevented by making credit card payments on time and opening a secured credit card.
Low income Banks will ask for your job and income to ensure that you repay the loan properly. Application can get rejected if your income is not enough to pay the due. They require regular and reliable income from the applicant and also expect to repay the loan within 3 to 5 years. Before attempting to get debt consolidation loans, make sure that you have a steady source of income for managing the payments for loans and monthly expenses.
No collateral The lender may ask for collateral, as that is the only way to get money back if you don't repay the loan. The collateral property can be anything, even your