When life throws you into financial troubles unexpectedly, the choice of getting a small loan to help you out is a welcomed foothold as you try to regain stability. A personal loan comes as and when you require them. But what if you have a bankruptcy record on your account? Can you get a personal loan, then? Apply a personal loan online today.
The good news is yes; you can still get a personal loan. The not-so-good news is that the procedure comes with a load of admonitions and expected blows. If you understand the procedure before you apply for a personal loan, you can prepare in advance and plan better and thus improve your chances of getting your loan approved.
First thing first, if you have been declared bankrupt, your credit score is likely critically damaged. A combination of a low credit score and bankruptcy is a lethal combination every lender will try to avoid and will lower your chances of improving it.
If you are declared bankrupt, you might be at your critical limit of managing your debt to income ratio. Bankruptcy sometimes is an answer to reboot your financial situation. You might have planned to stop creditors from constant repayment harassments, communications, legal threats, and foreclosure attempts. Bankruptcy, though, can give you a chance to revive however its consequences can be haunting.
How can you increase your chances of getting your personal loan approved:
You need to be careful of the lender offering you a loan almost immediately after the bankruptcy discharge. These credits may bear exorbitantly higher rates of interest and charges. To be on the safer side, make a plan in advance to clear off the loan as soon as you can and rather, rethink whether you require such credit.
Prepare yourself before you apply for a personal loan to improve your chances of approval by following these few tips:
Have patience and restore your credit score:
Wait for your bankruptcy to age which will lead to improving your credit score. You can apply for a secured credit card to improve it. However, you need to make sure you make only small purchases and pay them off quickly.
Be ready for the formidable documentation process:
The lender will carry out a thorough documentation process if he considers your request, even after you have improved your credit score, so you need to be ready for it. Get all the necessary documents evidencing your savings and incomes that can convince your lender of your ability to pay off the future debt.
Lastly, be prepared if rejection follows:
Realistically, there will be chances that you might get rejected due to a low credit score and past debt history, so brace yourself for no. However, remember that there are some banks and financial institutions that specialize in cases like yours and you might have better chances with them if you already have a good relationship with such a lender.
Even with the discharged bankruptcy on your record, you do have chances to get a personal loan. It is recommended that you seek help from your home bank or the bank you have been a customer of before you approach any new lender. If you are unable to obtain a loan, consider making a joint application for a loan, if possible.