Introduction
You’ve been trying to get out of debt for months and feel like nothing’s working. The problem is that your finances are in the wrong way. You need help—and fast! You know that Bad Credit Debt Consolidation Loans might be the answer: they’ll let you pay off all your outstanding bills once with one lump sum while lowering your interest rates and saving on fees. But what happens if the bank turns down your request? There are several reasons why this could occur, but don’t worry: plenty of other lenders out there might say yes! Here are some common explanations for rejection, along with tips for overcoming them:
You’re not earning enough.
You may not be able to afford your debt consolidation loan if your income is too low. The lender will want to make sure you can still make the payments on their new loan, even with all your current debts paid off. If they think that you might struggle, then they may not approve your application at all.
You have too much debt.
In a nutshell, the best way to determine whether or not you have too much debt is to compare your total monthly payments to your monthly income. If you can only cover your minimum required expenses on all of your credit cards each month, it’s time for action.
In general, if you’ve got more than three credit cards with balances and are having trouble keeping up with minimum payments, that’s a sign that something needs fixing.
No matter what kind of debt you’re dealing with (mortgage, medical bills etc.), there are ways out of it—but they require some work on your part:
Your credit report isn’t clean.
Your credit report is a record of your past payments, including:
· How you’ve repaid other loans. The rating agencies take notice of how you’ve handled previous debt. If you pay late or don’t follow through with the terms of your loans, that can affect whether or not they’ll lend money to you in the future.
· Whether or not you’re in default on any accounts. It’s important to know what information is included on your three bureau credit reports before applying for a loan, so check them and ensure no surprises lurking in your files!
You’re not considered financially responsible.
Financial responsibility is a measure of your ability to repay a loan. If you have a history of not paying bills on time, or if you have a lot of debt, or no savings, then your chances of getting approved for Bad Credit Debt Consolidation Loans will decrease.
Your request is seen as a sign of desperation.
In general, lenders view debt consolidation as a sign of desperation. Lenders are wary of lending money to someone they think may be unable to pay them back. It’s important to remember that you’re applying for a loan, and it’s up to you how you want your request portrayed.
The lender doesn’t believe you’ll be able to repay the loan
You need to prove that you have a good track record of paying back loans. You can do this by providing the lender with copies of your previous loan statements, showing that you have consistently paid back your debts on time.
Don’t let these factors negatively impact your chances
First, let’s talk about what to do if you have a bad credit score. If your credit score is not where it needs to be, there are some options you can explore that may help. One option is getting someone with good credit to co-sign your loan application. This gives the lender more security if something goes wrong with paying back the loan and gives them confidence that you will repay the debt.
Conclusion
A debt consolidation loan is one of the best ways to get out of debt, but it can be tricky. You may find that you spend months or years trying to get approved for a consolidation loan only to be turned down repeatedly. When this happens, it’s important not to give up hope!
