Getting your loan approved might not be an easy process if you do not have enough information on how to obtain a loan from a financial institution or what needs to be done to get approved for one. It can be likened to applying to get admission into a University without having adequate information of the admission requirement that would guarantee your acceptance into the University. Also for a loan, there are eligibility requirements that would guarantee your loan approval.
In this blog post, we will highlight the necessary requirements that you would need to get your loan approved.
- Personal Information
This is an important requirement because no financial institution or bank will want to give out a loan to an anonymous being or someone whose information does not align with the documents submitted. The following are the personal information that would be required of you during your loan application that can either get you approved or not.
- Names
- Addresses
- Phone number
- National Identity Number
- Bank Verification Number
- Employment information
- Bank statement
The basic information above will be required of you to enable the financial organization to cross-check your information using some third-party sites to be sure that you have a good credit history and have the ability to pay back the loan.
What To Do: Make sure your personal information is correct and you have all the necessary documents that you would need.
2. Purpose of loan
Not all financial institutions ask you for the purpose of your loan. However, some will want to know how you want to spend it. If you don’t want to bother yourself by providing the purpose of your loan, then you can consider getting your loan from online financial organizations like CredPal. With CredPal, you don’t have to provide the purpose of your loan to get it approved, you can use it for whatever reason that you want to.
What To Do: Make sure you have options. Do I want to tell them the purpose of my loan or I want to get my loan from a financial institution that wouldn’t ask me? Make sure you provide answers to these questions before you proceed.
3. Credit History
The same way Universities will check through your admission documents to be sure you meet up with the cut-off mark, is the same way a financial organization will check through your credit history. This is to be sure that your credit score is good enough to approve your loan. A bad credit history comes from taking previous credit and defaulting in repayments, either paying late or not paying at all. If you then decide to go and apply for another when you have not paid the debt from the previous loan, you have just shot yourself in the leg because these financial organizations have a way of checking your credit history. And if bad, your loan will not be approved that is why credit card or loan repayment is very important.
What To Do: Ensure that you take your credit card and loan repayment seriously so that you do not attract credit card and loan debt which can make you a threat to other financial organizations and can hinder your loan from being approved.
4. Financial statement
It is not enough to say that you earn 500k every month, you need to provide proof with your financial statement. Your financial statement is also proof to assure your financial organization that you can pay back that which you want to borrow. The duration of your bank statement differs. Some lenders like CredPal will ask for 6 months’ bank statements while some will ask you for 1 year to be sure that you have a consistent flow of income.
What To Do: Making a false figure of how much you earn monthly will do you no good, ensure that you are sincere and true during your application process so that your financial organization can find you reliable and trustworthy.
5. A Guarantee Form
Credit card and loan scams are real. People can get all the information above on behalf of someone else and ask for loans on their behalf. To avoid this, banks and financial institutions give out a written document to customers to sign when they request a loan. This is to ensure that there is a legal proof when cases of impersonation arise.
What To Do: If you get a mail that tells you to confirm or accept a loan that you did not apply for, kindly call the financial organization and report such a case. Pay attention to your emails and guard your personal information dearly.
6. Debt-To-Income (DTI) Ratio
It is important that you do not use 43% of your salary to repay money you have borrowed from financial institutions. Your debt-to-income ratio is all your monthly debt payments divided by your gross monthly income. The higher your DTI, the higher it is running into trouble to make your monthly repayments. Most financial organizations will not approve your loan when they realize that you are using a larger percentage of your income to pay debts.
What To Do: Make sure you are not running many loans at the same time and you are not using a larger percentage of your income to pay debt.
If after reading all these, you are ready to get a loan and you are sure that you have all these in check, then you can get a CredPal loan and be assured that you will not have to stress to get it approved once you have the right information and documents, a good credit history, and a bank statement that can allow you payback.
