Loan application rejected? Do these 5 things to get it fast

Loans have become quite popular nowadays as people can get them easily and without much hassles. Banks have made loan processing easy and fast. But sometimes your loan application gets rejected, or you fail to get the desired amount. What to do in such a situation? 

Kshitiz Mahajan, Co-founder, Complete Circle Consultant told Zee Business TV, "Loan applications often get rejected due to poor CIBIL score of an individual. A person should know about his/her CIBIL rating and do the best to improve the same to get loans easy. While there are a number of factors responsible for loan rejections, but they all have solutions.''

Here are a few things you can do to avoid such loan rejections:

1. Check/Improve your CIBIL score: CIBIL is an agency that gives every individual a rating or a score on the basis of his past financial records. It analyses the time of repayment, the credit availed, income and various other things to give a score. Banks grant loans on the basis of these ratings by CIBIL. ''One should check his CIBIL rating and try to improve it by repaying pending loans, clearing off debt in order to get loans easily,'' Mahajan said.

2. Avail loan as per your income: People often ask for more than they deserve or require. Banks usually reject loan applications that ask for loans more than appetite or repayment capacity of an individual. '"If the bank or the lender finds your income non-parallel with the loan amount, your application may get rejected. Make sure you ask for a decent amount. For example in case of a home loan, you can get up to 6 or 8 times of your annual income,'' said Mahajan. 

3. Avail loans against assets: Even if your loan is rejected, you can still try the other way out. If you have some assets like, gold, stocks, mutual funds, bonds, real estate etc, you can avail a loan against them. Banks find it easier to pay loans on collateral and your application is less likely to get rejected.

4. Get loans from NBFCs: In case the loan application is rejected by your bank, you can approach an NBFC to get one. However, NBFCs charge higher interest rates as compared to banks. 

5. Repay your pending loans: ''If you still have some old pending dues left in your bag, you need to get rid of them as early possible. Banks do not grant loans to borrowers who already paying hefty EMIs on pending loans. 

''Also, one should never avail a loan for a need that can be avoided. A loan is a serious financial decision of life which can make or break your financial fitness,'' said Mahajan.