{"id":14189,"date":"2022-10-19T10:00:40","date_gmt":"2022-10-19T15:00:40","guid":{"rendered":"https:\/\/www.netcredit.com\/blog\/?p=14189"},"modified":"2025-10-22T12:24:51","modified_gmt":"2025-10-22T17:24:51","slug":"loan-application-declined","status":"publish","type":"post","link":"https:\/\/www.netcredit.com\/blog\/loan-application-declined\/","title":{"rendered":"What To Do if Your Loan Application Is Declined"},"content":{"rendered":"<p>Having your loan application declined can be scary \u2014 especially when you <a href=\"https:\/\/www.netcredit.com\/quick-loans\">need the funds fast<\/a>. Luckily, there are steps you can take to improve your chances of being approved.<\/p>\n<p>If you were denied financing, you\u2019re not alone. Thirty-three percent of Americans were denied personal credit in 2021.<sup>1<\/sup> Here\u2019s what to do if your loan application is declined.<\/p>\n<h2><strong>Determine Why You Were Denied<\/strong><\/h2>\n<p>When you\u2019re denied a loan, the first thing you\u2019ll want to figure out is why. You may find it was a simple paperwork mistake, or it could help you figure out what areas you need to work on. Here are some of the common reasons loans are denied.<\/p>\n<ul>\n<li><strong>Your Credit Score Was Too Low.\u00a0 <\/strong>Most lenders have a required minimum <a href=\"https:\/\/www.netcredit.com\/blog\/what-does-my-credit-score-mean\/?popular=true\">credit score<\/a>. If you don\u2019t meet the requirement, your application will likely be declined. Your credit score is important because it gives the lender a quick measure of your credit and repayment history.<\/li>\n<li><strong>You\u2019ve Borrowed Too Much. <\/strong>If you already have a loan, line of credit or your credit card is almost at its limit, lenders may deny your loan application. This is different from taking out a loan to <a href=\"https:\/\/www.netcredit.com\/blog\/best-tools-consolidate-debt\/\">consolidate debt<\/a> \u2014 which may help you manage your monthly bills. Taking on an additional loan on top of other debt can be risky and may lead to some financial trouble.<\/li>\n<li><strong>You Don\u2019t Have a Steady Source of Income. <\/strong>Lenders will want to verify that you have a source of income that will allow you to repay the loan. You\u2019ll need documentation of your income (pay stubs or bank statements) to prove that you have the capacity to take on debt.<\/li>\n<li><strong>You Don\u2019t Meet the Minimum Requirements. <\/strong>For most lenders, you need to meet some basic requirements to take out a loan. This could include things like your age or citizenship status. Always research lenders to see if you\u2019re able to borrow from them.<\/li>\n<li><strong>You Had Information Missing on Your Application. <\/strong>Sometimes, it\u2019s as simple as missing information on your application. Double-check to see if there is anything that didn\u2019t get recorded correctly or was left off.<\/li>\n<\/ul>\n<h2><strong>How You Can Boost Your Chances<\/strong><\/h2>\n<ul>\n<li><strong>Find a Lender That Fits. <\/strong>Traditional lenders, like banks, may have strict credit history and personal requirements. <a href=\"https:\/\/www.netcredit.com\/\">Online lenders<\/a> often have more forgiving standards. You may qualify for an online loan or <a href=\"https:\/\/www.netcredit.com\/line-of-credit\">line of credit<\/a>, even if you were denied at the bank.<\/li>\n<li><strong>Only Apply for What You Need. <\/strong>Think through how the money will be used and create a plan. You may not need as much as you originally thought, and having a plan will help you put the funds to the best use. You may get approved if you apply for a lower amount.<\/li>\n<li><strong>Improve Your Financial Health. <\/strong>Financial health is important but can feel like an uphill battle when you\u2019re trying to get back on track. When things get tough, focus on the goals you\u2019re working towards. If you\u2019re a NetCredit customer \u2014 check out some of our <a href=\"https:\/\/www.netcredit.com\/resources\">online resources.<\/a><\/li>\n<\/ul>\n<h2><strong>Build Your Financial Health<\/strong><\/h2>\n<ul>\n<li><strong>Free up Some Funds. <\/strong>Go over your last few months of bank statements and see if there\u2019s anywhere you\u2019re able to cut back. You may find that there are some areas where you can reduce your spending and free up some more cash.<br \/>\nIf you\u2019re already feeling stretched thin, you can often find local support. Search for resources like food assistance and help with utilities and household bills through SpringFour. NetCredit offers <a href=\"https:\/\/www.netcredit.com\/ways-to-save\">access for free<\/a>.<\/li>\n<li><strong>Build Your Savings. <\/strong>One of the first rules in personal finance is to pay yourself first. This means taking a portion of your income and putting it into savings before you pay anything else. Even if it\u2019s only five bucks a paycheck, it\u2019ll help you get in the habit of saving.<\/li>\n<li><strong>Build a Better Budget. <\/strong>The word budget might create some feelings of anxiety, but it doesn\u2019t have to. Some online tools and apps can help you create and stick with a realistic budget. One of the easiest ways to start is with the 50-30-20 rule. This means you spend about 50% on needs, 30% on wants and 20% on savings.<\/li>\n<\/ul>\n<h2><strong>Consider Other Options<\/strong><\/h2>\n<p>If you\u2019re still unable to secure a loan, there are some things you can do to make some extra cash. Here are a few ways to boost your monthly income.<\/p>\n<ul>\n<li><strong>Get a Side Hustle. <\/strong>Consider taking on some extra work. There are many opportunities you can take advantage of. Here are some ideas:\n<ul>\n<li>Part-time work at a local business<\/li>\n<li>Pet-sitting<\/li>\n<li>Deliver for a food delivery service<\/li>\n<li>Drive for a rideshare company<\/li>\n<li>Become an online assistant<\/li>\n<\/ul>\n<\/li>\n<li><strong>Get Creative. <\/strong>If your schedule is too tight for a side hustle, you can get creative with some money-making ideas. You could host a garage sale or sell unwanted clothes. If you\u2019re a photographer or artist you can sell your work. Think outside the box and look for opportunities unique to you!<\/li>\n<\/ul>\n<p><strong>Resources:<\/strong><\/p>\n<p><sup>1<\/sup>Backman, M. (2022) <a href=\"https:\/\/www.fool.com\/the-ascent\/personal-finance\/articles\/33-of-americans-were-denied-credit-in-the-past-year-heres-how-to-change-that\/\">33% of Americans Were Denied Credit in the Past Year. Here&#8217;s How to Change That<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Having your loan application declined can be scary \u2014 especially when you need the funds fast. Luckily, there are steps &#8230;<\/p>\n","protected":false},"author":31,"featured_media":14193,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[894],"tags":[845,847,846],"class_list":["post-14189","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-personal-loans","tag-application-declined","tag-declined-loan","tag-denied-financing"],"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","pp_post_mime_type":"publish","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What To Do if Your Loan Application Is Declined - NetCredit Blog<\/title>\n<meta name=\"description\" content=\"Understand common reasons loan applications get declined and how to improve your chances next time.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.netcredit.com\/blog\/loan-application-declined\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What To Do if Your Loan Application Is Declined - 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