This is a guest post from Thanh Kess, a professional specializing in personal finance, bankruptcy, and credit repair. To learn more about the action you should take if you are denied a loan because of outstanding debt, visit www.ClearBankruptcy.com.
There will undoubtedly come a time (or many times) in your life where you find that you are short on cash when you need it the most. It may be an unforeseen medical bill, a semester of college, a car accident, or even a vacation that spurs your desire to procure borrowed funds. One standard go-to for such situations is the personal loan. A personal loan is different from a secured loan in that you are not required to put up a collateral, and you do not have to define the purpose of your loan – it can be used for anything that you deem necessary. If you find that your personal loan application is denied, it is important that you have a back-up plan. Here are some things you can do if you are denied a personal loan:
Ask why. Make sure you get clear-cut reasons for your denial. You may find that you can compensate for these factors by tweaking your application a bit or providing further proof of your credit worthiness. If not, you will at least know what you need to do in order to improve your chances of getting an approval the next time around.
Apply somewhere else. Just because your application was denied by one lender, it does not mean that you can’t get an approval at another lender. There is no substitute for trying again, elsewhere.
Improve your credit. Make it a point to correct credit report blemishes. This may be as simple as reporting inaccurately recorded information in order to have it updated on your report, or it may require that you settle some judgments. Either way, bettering your credit is your best bet for ensuring your ability to procure a personal loan when the need suddenly arises.
Try other routes. Payday advance loans and car title loans are by no means the ideal option, but they are available to those who really need it. If you’re in financial dire straits and have nowhere to turn, it may be time to turn to the hard money lenders.
Seeing that awful word, “denied,” in response to your personal loan application can be a horrifying experience if you’re in a situation where you really need the money. If you are forced to come face to face with that dirty word, don’t worry – all is not lost. You’ll just have to put some effort into making your situation work, and that may involve alternative options.