Why did my loan get denied with good credit?
Maybe you have a bad financial association and too much existing debt. Perhaps your salary is listed differently in two records, or you once missed a credit card repayment. It could be tricky to pin down the cause of a denied credit card or loan application, even with a good credit score.
It's possible to have a loan denied even if you have good credit. As mentioned, your DTI, income and basic qualifications could be insufficient, or your loan application might have a mistake on it.
You may also have a history of high credit utilization. If you consistently max out your credit cards, for example, issuers may be hesitant to offer you new credit even if you always make your payments on time. Or maybe you've applied for too much new credit within a short time period.
There are a few reasons your application might have been rejected, including: having a short credit history – it can take time to build a solid credit history. applying for too much credit in a short time – hard credit checks are recorded on your credit report, and having too many can negatively affect your application.
Having a high debt-to-income ratio — the amount of debt on credit cards, other loans or a mortgage compared with the amount you're paid — is another possible reason for loan denial. Also, a loan application could be declined for something simple like incorrect or missing information in your application.
According to the FICO® scale, a good credit score falls between 670 and 739. However, having a score in that range or above doesn't guarantee approval on credit applications.
In general, lenders extend $30,000 loans to borrowers with good to excellent credit, which is typically 670 and higher. But there may be lenders who lend to borrowers with bad credit. If you're having difficulty qualifying, you may consider getting a cosigner or co-borrower to help you get approved for the loan.
Well, there are several credit score ranges. For instance, 780–850 may be considered "excellent" while 720–780 may be seen as "good." But when it comes to a range that may be seen as bad, a score between 300 (the lowest) and 660 fits into the “poor” category.
Being denied for a credit card doesn't hurt your credit score. But the hard inquiry from submitting an application can cause your score to decrease.
Your 825 FICO® Score is nearly perfect and will be seen as a sign of near-flawless credit management. Your likelihood of defaulting on your bills will be considered extremely low, and you can expect lenders to offer you their best deals, including the lowest-available interest rates.
How to get a loan when no one will approve you?
- Peer-to-Peer Lending. ...
- Car Title Loans. ...
- Borrow Money From a Friend or Family Member. ...
- Pawnshop Loans. ...
- Payday Loans. ...
- Credit Card Cash Advance.
You may have existing high levels of debt – If you're already repaying a few loans, or have credit cards close to being maxed out, lenders may think you're already over-committed. You may need to take some time to work on repaying your existing commitments before lenders will accept you for a new loan.
- Credit card.
- Home equity loan or HELOC.
- Personal line of credit.
- Peer-to-peer loan.
- Life insurance policy loan.
- Retirement plan loan.
- Mortgage refinance.
Can You Still Be Denied a Loan With a Co-Signer? You can still be denied, but only in rare circ*mstances, most of which will likely not apply to a first-time borrower.
You have high outstanding debt
Having too much debt might hurt your chances of being approved for new credit, especially if your debt-to-income ratio or credit utilization ratio is high. Your debt-to-income ratio measures your debt as it relates to your income, and it may indicate whether you can handle more debt.
Borrowers may be denied for vehicle financing due to errors in the application, bad or limited credit or a large amount of debt. The first step following auto loan rejection is to contact the lender to request the specific reasons for the denial.
Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.
You can borrow from $1,000 to $100,000 or more with a 700 credit score. The exact amount of money you will get depends on other factors besides your credit score, such as your income, your employment status, the type of loan you get, and even the lender.
So, given the fact that the average credit score for people in their 20s is 630 and a “good” credit score is typically around 700, it's safe to say a good credit score in your 20s is in the high 600s or low 700s.
The monthly payment on a $30,000 loan ranges from $410 to $3,014, depending on the APR and how long the loan lasts. For example, if you take out a $30,000 loan for one year with an APR of 36%, your monthly payment will be $3,014.
What is the monthly payment on a $30,000 loan?
Loan Amount | Loan Term (Years) | Estimated Fixed Monthly Payment* |
---|---|---|
$25,000 | 5 | $514.57 |
$30,000 | 3 | $926.18 |
$30,000 | 5 | $608.15 |
$35,000 | 3 | $1080.54 |
Requirements for a $20,000 Personal Loan
This means they'll want to see your credit score, income level and DTI ratio. Requirements vary by lender, but most lenders require borrowers to have a credit score in the good to excellent range — meaning a score of at least 670.
- Review Your Credit Report. ...
- Pay Your Bills on Time. ...
- Ask for Late Payment Forgiveness. ...
- Keep Credit Card Balances Low. ...
- Keep Old Credit Cards Active. ...
- Become an Authorized User. ...
- Consider a Credit Builder Loan. ...
- Take Out a Secured Credit Card.
- Get More Credit Accounts.
- Pay Down High Credit Card Balances.
- Always Make On-Time Payments.
- Keep the Accounts that You Already Have.
- Dispute Incorrect Items on Your Credit Report.
- Very Poor: 300-499.
- Poor: 500-600.
- Fair: 601-660.
- Good: 661-780.
- Excellent: 781-850.