In the Philippines, personal loans can be a helpful solution to cover unexpected expenses. However, not all loan applications are approved, and there are common reasons why a borrower’s application may be rejected. Financial institutions conduct a thorough investigation of your creditworthiness before approving your loan application, and if you fail to meet the criteria, your application may be denied. Here are some common issues faced by borrowers when applying for personal loans in the Philippines.
- No bank records: If you do not have a savings account, credit card, or a history of transactions with a bank or financial institution, it may be more challenging to get approved for a personal loan. Being a loyal customer of a bank or financial institution can increase your chances of approval. However, if you are not a loyal customer, you may need to provide additional documents and financial records to prove your creditworthiness.
- No fixed source of income: Lenders tend to approve loan applications from borrowers with stable income sources as this indicates their ability to repay the loan. Borrowers with a fixed income, even if it is low, are more likely to get approved than self-employed borrowers with a high income.
- No credit history or bad credit history: A low credit score or no credit history is one of the most common reasons for loan application denial in the Philippines. If you have no credit history or a poor credit history, banks and financial institutions may consider you a credit risk, and your chances of getting a loan may be significantly lower.
- Being in debt: If you have an outstanding personal loan with a bank or financial institution, your next loan application may be denied. This is because lenders are concerned about your solvency. Some lenders may still approve your loan application, but at a higher interest rate. Additionally, you may be required to provide collateral or find a person of good credit to act as your guarantor.
- Requesting an amount beyond capacity: Some borrowers apply for a loan amount that exceeds their current income, and this may lead to loan application denial. Lenders may only approve a portion of the amount that they believe the borrower can repay.
Improving your credit score by paying your credit card bills in full and on time, maintaining your old bank accounts and credit cards, and spending less than your credit card limit can increase your chances of getting a fast approval online loan from a bank or financial institution.
However, if you are struggling to get a loan approved, MoneyCat can offer another solution. At MoneyCat, you do not need an outstanding credit score, a stable source of income, or a history of transactions with a bank or financial institution. MoneyCat’s fast approval online loan is available to all Filipino citizens aged 22 and over, living and working in the Philippines, and having a legal ID. We simplify the application process and review documents within five minutes, and disburse funds within 24 hours. If you are looking for a simple, fast, and reliable online lender, MoneyCat may be the perfect solution for you.
In conclusion, there are common reasons why a fast approval online loan application may be denied in the Philippines, but improving your credit score and providing additional documentation can increase your chances of approval. If you are still struggling to get a loan, consider MoneyCat as an alternative lender.