Although it's important to research the loan market thoroughly make sure you don't make multiple full scale applications at this time. Each loan you apply for will cause a record to be placed on your credit report and this can appear to a new lender that other lenders have been turning you down. This can very easily influence the decision of the prospective lender and you could find yourself refused for no other reason than those multiple applications on your file.
Look for loan agreements in principle without consenting to a full credit search and then you can make the decision about which is the best loan for you and then make your proper application. If you are refused credit it's always important to find out why. Go to Experian and find out what is on your report that caused this. Although not legally required to most lenders will tell you why you have been refused a loan so don't hesitate to ask in this eventuality. Don't apply for another loan until you know why you were refused.
Lender's requirements. A lender needs to be as sure as possible that you can handle a loan responsibly and therefore if you have not borrowed money in the past you may find it difficult to get the best rate available. This is because your lack of a borrowing track record makes it hard for the lender to judge how reliable a customer you might be.
If you can show that you are capable of managing your money properly, maybe by having a credit card and a mobile phone and keeping them in good standing then possibly this might bring the best rate loan offers closer to you
Make sure you are not overstretched. Lenders always look at your credit file to see how much you have outstanding on credit cards, mortgages and loans. They can easily see how you are handling payments. They will also look at your credit limits. Even if you are not currently borrowing on all your credit cards a lender could possibly get nervous about lending you more if he fears you might go on a spending spree. It's probably better therefore to close credit card accounts that you don't need.
Explain your special circumstances. If you have a bad credit record, or you are currently having some financial problems, it makes a lot of sense to seek advice rather than simply borrow more. If you have ever missed repayments in the past they remain on your credit record for at least 36 months. IVAs, Court judgments and bankruptcies stay on the record for at least six years.
If your problems were due to special circumstances then explain why - for example, if you suffered an illness that affected your income you can simply add a note to your credit report. Most Lenders may take this into account when considering you.
ALWAYS steer clear of any organisation that claims it will repair your credit record - this is simply NOT possible unless a serious mistake has been made, in which case you can easily fix it yourself. Certainly never pay any company for so called "credit repair", any type of debt advice or rescheduling of debts.
There is usually a good reason for credit being refused to you. If you are having difficulties then the wisest step is first of all to review your spending. A good mover could be to consult with a debt councilling service.
If your credit rating is poor a quick way to improve it is to register on the electoral roll. Lenders use the electoral roll as a precaution against fraudsters. This helps them to prove who you are and where you live. If you are registered as living elsewhere or not registered at all the lender could ask for further proof of residence or could even just turn you down flat.
Look for loan agreements in principle without consenting to a full credit search and then you can make the decision about which is the best loan for you and then make your proper application. If you are refused credit it's always important to find out why. Go to Experian and find out what is on your report that caused this. Although not legally required to most lenders will tell you why you have been refused a loan so don't hesitate to ask in this eventuality. Don't apply for another loan until you know why you were refused.
Lender's requirements. A lender needs to be as sure as possible that you can handle a loan responsibly and therefore if you have not borrowed money in the past you may find it difficult to get the best rate available. This is because your lack of a borrowing track record makes it hard for the lender to judge how reliable a customer you might be.
If you can show that you are capable of managing your money properly, maybe by having a credit card and a mobile phone and keeping them in good standing then possibly this might bring the best rate loan offers closer to you
Make sure you are not overstretched. Lenders always look at your credit file to see how much you have outstanding on credit cards, mortgages and loans. They can easily see how you are handling payments. They will also look at your credit limits. Even if you are not currently borrowing on all your credit cards a lender could possibly get nervous about lending you more if he fears you might go on a spending spree. It's probably better therefore to close credit card accounts that you don't need.
Explain your special circumstances. If you have a bad credit record, or you are currently having some financial problems, it makes a lot of sense to seek advice rather than simply borrow more. If you have ever missed repayments in the past they remain on your credit record for at least 36 months. IVAs, Court judgments and bankruptcies stay on the record for at least six years.
If your problems were due to special circumstances then explain why - for example, if you suffered an illness that affected your income you can simply add a note to your credit report. Most Lenders may take this into account when considering you.
ALWAYS steer clear of any organisation that claims it will repair your credit record - this is simply NOT possible unless a serious mistake has been made, in which case you can easily fix it yourself. Certainly never pay any company for so called "credit repair", any type of debt advice or rescheduling of debts.
There is usually a good reason for credit being refused to you. If you are having difficulties then the wisest step is first of all to review your spending. A good mover could be to consult with a debt councilling service.
If your credit rating is poor a quick way to improve it is to register on the electoral roll. Lenders use the electoral roll as a precaution against fraudsters. This helps them to prove who you are and where you live. If you are registered as living elsewhere or not registered at all the lender could ask for further proof of residence or could even just turn you down flat.
About the Author:
Mr Marsh is a Financial Adviser in the UK and runs a prolific best rate loans website. If you require a brilliantly low rate loan then please click the link above and apply today. Lowest interest rates guaranteed! Get a totally unique version of this article from our article submission service
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