When requesting a personal loan, be honest and forthright when it comes to your reasoning for taking out the loan. Your reason could include anything from debt consolidation to adding a new bathroom to your home to even buying new furniture.
LightStream Personal Loans
Excellent credit required for lowest rate. Rates vary by loan purpose. There isn't really a hard-and-fast rule about what the loan must be used for, but you'll usually have to explain the purpose of the loan when you apply for it.
Personal loans can be used for almost any purpose. Debt consolidation, financing home improvement projects, paying for moving costs or emergency bills are some of the most common reasons to get a personal loan. Before applying for a loan, assess your credit and finances to avoid future financial woes.
In short, yes. While most reasons won't stop you from obtaining a personal loan, you'll need to explain why you need the money you're borrowing. You can generally use the loan proceeds however you see fit, but some lenders have restrictions. Plus, the loan purpose could impact the loan terms you receive.
A personal loan can be used for just about anything. Some lenders may ask what you plan to do with the money, while others will just want to be certain that you have the ability to pay it back. A personal loan isn't inexpensive, but it can be a viable option in a variety of circumstances.
The reasons for loan denial can vary based on your unique situation. Common factors that prevent you from getting a personal loan can include a low credit score, insufficient credit history, a high debt-to-income (DTI) ratio or requesting too much money.
The most common reasons to get a personal loan include emergency expenses, major purchases, home repairs, or milestones. A personal loan may be the right option if you have a good credit score, and your costs fall under these categories.
If you're self-employed, have been on the job for a short time, have a short credit history, or simply don't have enough cash reserves in the bank, your underwriter can reject a loan application that was initially approved. This is called “layered risk”.
Being accepted does not mean that you have to accept the money. Instead, it simply means the lender has accepted your application and is willing to loan you the funds you applied for in the form of a loan. Fortunately, choosing not to accept a loan that you are approved for does not yield any consequences on your end.
This depends on your financial situation. For those with a good credit score — around 670 and up — a $30,000 personal loan may be pretty easy to get.
Borrowing $50,000 is a significant responsibility. Because of the large amount, lenders typically have stricter eligibility criteria to qualify for a loan. This often includes meeting a minimum credit score requirement.
Personal loans generally aren't hard to get and are available from credit unions, banks, and online lenders. There are various types of personal loans to consider, depending on how much money you need to borrow.
On top of the economic trends affecting the lending market, unsecured personal loans can be difficult to get approved for in general. Many lenders and financial institutions require at least a good credit rating, a healthy credit report and a stable income to get approved.
A low credit score doesn't have to keep you from getting a personal loan to cover an emergency or consolidate debts, but borrowers with bad credit scores (629 or lower) may need to put in extra work to qualify.
They usually only check on a personal loan if you took that loan to pay off another loan or credit cards. This is reasonable because if you did not pay off the credit cards or other loan, then your indebtedness is a whole lot more than they anticipated.
Can You Apply for a Loan and Not Accept It? Yes. If a lender has approved your application for a personal loan, you're not required to take it. This is an important distinction from credit cards, where your account is opened immediately upon approval.
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Some of the easiest loans to get approved for if you have bad credit include payday loans, no-credit-check loans, and pawnshop loans. Personal loans with essentially no approval requirements typically charge the highest interest rates and loan fees.
Not all personal loans require proof of income, such as a tax document or bank statement, but it's quite common, so it's important to be prepared to back up the income you claim on your application.
Today, you can't face prison time for failing to pay civil debt. This is more commonly known as consumer debt, and it refers to many types of debt, including credit cards, medical bills, student loans, personal loans, payday loans, auto loans, mortgages, rent, utility bills, overdrafts on accounts, and more.