Tips Before you Apply for a Loan
Applying for a loan might seem as simple as filling out an online application but there is a number of things to consider before you take that step which can actually help the process of getting approved. Not all loan applications are the same, whether you are looking for some start up money for a new business your wanting to get off the ground, cash for a used or new car or just a quick advance before pay day its good to know what is going to help to speed things up.
1. Decide what type of loan you specifically need, there is no point taking on board more than you can bite or not enough to cover what you need it for. If its a business you need the money for the lender will be looking at a number of things such as how long you have been in business, if your business is new how you expect to increase profits and meet all the expected loan payments on time.
2. Organizer all the documents ahead of time before you fill out the loan application. Usually you will have to provide income proof though that varies depending on the type of loan application you are filling out, such as ones for people with bad credit their is a lot less that you have to provide but the risk for yourself is a lot higher and for the lender. You may need to provide a IRS tax retrun or a W-2 form which shows history of income, you may need to get bank printouts, any information you have on other loans, debts and any assests you have which could be liquidized.
Among other things you will need to show your
-Home and possibly your work address, phone number and optionally an email address.
-Where you have lived over the last couple of years
- Social security number
- COntact information for any landlord
- Information on your mortage payments
- Income statements up to 3 years
- Possibly W-2 for the past 2 years..
Again each loan application varies but gathering as much information which shows your income, and current payments you are making on any cars, homes and cards are very helpful.
3. Highly Important before applying to anything do a quick free credit report check to find out what your credit score is, as you might want to hold off the loan for a few months to build up your score, the lenders will look into that.
4. Any stubs, payments on credit cards, mortages, renting etc over the past 2 - 3 yeares will help too
5. Before sending in any application have someone spell check it to be check that there are no errors and that the grammar is good, all of which could cause delays or being declined.
Warnings
Do not fill out lots of loan applications all at once as lenders check with credit agencies and it can actually work against you. They can tell if someone is deperate vs someone who just needs a loan.
Be honest at all times, you do not want to get on the bad side of banks and lenders, keep all your information accurate and up to date. When in doubt go low than high on figures that you need to input in.
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