There may be several reasons why you may be denied your loan applications. Is it because you are applying for a bank, you can choose to apply for a loan online instead. If the rejected loan applications from online loan companies, then there is probably a good explanation for your rejection. These loan companies do not reject potential customers unless they have a good reason.
When you take out a loan, you must pay the loan amount as well as the interest and fees returned. It is therefore not a service but a paid service provided by the loan company. In other words, it is a business and this business wants to minimize its risk as much as possible. Therefore, there are also mainly two reasons why your loan application is rejected.
1. Your income is too low
One of the most vital aspects of your loan application is that you have an income that can match the loan you intend to take out. It is not free to borrow money. Therefore, you must have an income that allows you to pay the monthly installments. If lenders believe that your income cannot cover your installments, then you will be denied your application.
There are no set rules you can use to determine if you can afford a given loan. It depends on the lender. They carry out their credit assessment of the customers and therefore it is also up to each provider to assess the amount of income required to be approved for various loan amounts.
2. You are registered in RKI
The vast majority of lenders fail if they find that you are registered with RKI. This means you have debt and have not paid it. Namely, RKI is a register of poor payers that the lenders have paid to access. Not only can they see that you are paying poorly, but they can also see how much debt you have – and then your application is typically rejected.
Only very few providers willing to lend money to one person are in RKI. If you are in RKI, then you cannot be sure that you can be allowed to borrow money – and not at all if you also have a low income. There may also be a few other reasons why you may be denied your application, but these are the two primary reasons.
Loan companies run a business
As has been stated before, a lender is not a voluntary association, but rather a tough business. Therefore, you cannot expect you can be allowed to borrow money if you cannot prove you are able to pay both loans as well as expenses returned to the lender. It can be difficult to prove if you are in RKI or if you have a very low income.