Whether you are applying for a personal loan for the first time and you want to know how to boost your chances of being approved, or you have been rejected for loans by providers before, this guide can help you understand how to successfully obtain finance

If you have been rejected for a loan before, that doesn’t mean you can’t successfully apply for a loan in the future. Common reasons for rejection include a poor or limited credit history, applying too many times in a short space of time, or even something as simple as making a mistake on your loan application.

In some cases, these can be fixed. And even if the fix requires more effort, the sooner you start addressing any potential issues, the sooner you can access the finance you need.

Below are eight tips that could help to improve your chances of being accepted for a loan.

• Review your finances

Before you even apply for a loan, make sure you need it. If you can afford what you want to buy without taking out a loan, it might be better to do so in the long run. If you can’t afford something up front, work out how long it will take you to save up the money you need by budgeting.

Even if you do decide you need to take out a loan for your purchase, careful budgeting will help you figure out exactly how much you can afford to repay each month. This can then help you decide what kind of loan, if any, is right for you. * Research your options

Take the time to research the market and explore the range of credit options available to you. This can help you learn the basics of borrowing and whether a loan is the right form of credit for the goods or service you would like to buy.

Try to decide what type of loan you are looking for and whether you are eligible before applying to a lender. For example, you may prefer a secured loan, where lenders will require some form of security in case you fail to repay the loan, or an unsecured loan (also called a personal loan), where you simply pay off the loan each month. * Check your credit score

Your credit report has a significant impact on your loan application and whether it is successful or not. It informs lenders of the risk that lending to you presents to them, which is how they will decide how much they are willing to lend to you and if they are willing to lend to you at all.

# Checking your statutory credit report through a credit reference agency is a free, quick and simple way of working out how lenders might view your application. It can highlight the areas where you could improve your score, which could then increase your chances of getting accepted for a loan. Your credit score is calculated using data from your credit report and will help give lenders an idea of your borrowing power. Some credit reference agencies may charge a fee for access to your full credit report and score.
Typically, the higher your credit score the more likely your loan application is to be accepted, and the better terms you’ll receive. Although other factors will come into the decision making process, such as your income and the affordability of the loan itself, loan providers often reserve their best deals for those with excellent credit ratings. * Build up your credit history

A poor credit history is one of the most common reasons why a lender might reject your loan application. This is because it suggests you may not manage credit arrangements well.

If this is the case, there are several ways you could start to improve it. Checking your credit score can highlight some areas to work on, and you can also make sure that there are no mistakes on your credit report that could be affecting your score.

#Paying bills and other payments on time and aiming to reduce any debt you may have could help build a score that shows you are a reliable consumer when it comes to managing debt. * Review outstanding credit

If you already have several credit cards or other loans, this could affect your chances of getting a further loan.

# Lenders may be wary about lending you more money if you have several outstanding forms of credit, as they may think there’s a higher risk that you wouldn’t be able to repay the loan.

However, having open forms of credit won’t necessarily stop you from getting a loan. It will depend on the individual lender, how you have managed your credit commitments, and how much of your available credit you are using, and whether the lender thinks you can afford to take on more credit. * Compare lenders
Comparing lenders is a simple way to boost the chance that your loan application will be approved by matching you up with the right provider. This means it’s important to compare lenders and check their eligibility criteria to make sure you only apply for loans that are suitable for your situation. * Double-check your application
A small mistake or discrepancy on your loan application can result in rejection. Make sure you enter all information accurately, including your address, date of birth and residency status to allow your application to progress. * Space out credit applications
If you are rejected for a loan, think carefully before you make another application. The more ‘hard’ #credit checks a lender sees on your file over a short time period, the more wary they are likely to be about lending to you. Your desire for credit will send a red flag to lenders about your ability to manage your finances responsibly.