1: My application was denied. What do I do?
If your loan application was denied, don’t panic. The first thing you should do is ask your lender why it was denied so you know what to do in the future to prevent the situation. If it was because of bad credit, check your credit report to make sure all the information is accurate. Then work on rebuilding your credit score by making timely payments on all of your bills and stopping any loan or credit applications that require a hard pull.
2: How long will it take me to get the money?
Depending on the lender and how you want to receive your money, you can receive your funds on the same day or within 1-2 business days.
3: What are the normal requirements for a personal loan?
Personal loan requirements vary by lender, but typically you’ll need a social security number, income information like W2s and bank statements and collateral if you’re taking out a secured loan. Some lenders require a minimum credit score, while others offer loans specifically for people with poor or no credit.
4: Can I get a personal loan if I have a poor credit rating?
Yes, although the lower your credit score, the more you will pay in interest. Different lenders have different requirements and some even focus on customers with low credit. If your credit score is still too low to qualify for a traditional personal loan, you can still apply for other loan products like a payday loan.
5: How and when do I repay the loan?
When your loan application is approved, your lender will outline the repayment process. Typically you’ll have monthly installment payments that include principal and interest. Some lenders require an automatic payment to be set up to help you remember each month’s due date.
6: What do I do if I miss a payment and what happens?
Try to contact your lender before you miss a payment, especially if you think you’ll have trouble making other payments it the future. You may be able to refinance your loan and receive lower monthly payments. Otherwise, your lender will likely report your delinquent loan to the credit bureaus, which will lower your credit score.
7: Can a personal loan application affect my credit score?
Yes, if the lender uses a hard inquiry on your credit report, then your credit score will temporarily dip. Many pre-approval applications only require a soft inquiry, allowing you to shop around for interest rates before the lender does a hard pull. This is particularly beneficial if you want to assess several loan offers without hurting your credit score with multiple hard inquiries.
8: Can I use a personal loan for anything I want?
Yes, most lenders don’t have limitations on what you can use your funds for. Whether you want to consolidate credit card debt, pay for medical expenses or renovate your home, a personal loan can give you access to the funds you need.
9: Does it cost anything to apply for a loan?
Most lenders don’t charge for the loan application; however, if you accept a loan, you will likely be charged an origination fee. This is usually determined as a percentage of the loan amount and is simply deducted from your funds at the time of disbursement. If you need a very specific amount of money, be sure to factor in the cost of the origination fee when applying for your loan.
10: What documents do I need to apply for a loan?
Documentation requirements vary by lender, but generally speaking, you’ll need personal contact information, your social security number, and some type of income verification such as tax returns or bank statements.