Being denied credit can be discouraging and confusing…but don’t give up just yet. There are many reasons you may be denied credit but you still have options. Here is a list of common reasons people are denied credit:
- Lack of credit. Believe it or not not having enough credit can prevent consumers from obtaining new credit. There are 2 ways that you can overcome this challenge. The first is that you can ask someone to co-sign on your credit application and then have them removed once you’ve determined your trustworthiness with the creditor. The second is that you can apply for a prepaid credit card to build up your creditworthiness.
- Too much credit can be the culprit to being denied new credit especially if the accounts you have are currently maxed out. The obvious answer is to pay down credit lines before requesting new credit lines.
- A short work history can also be a reason for denial. It is important to lenders that they see a steady employment history; without it they will be concerned with how you will fulfill your obligations of meeting your payments. The best thing to do here is find a job that you can stick with.
- A bad payment history can deter new lenders from loaning to a new borrower. If you feel that you are in over your head and cannot keep up on debt payment obligations it is best to not apply for new credit. Instead, work on putting together a budget and plan to keep current (and eventually pay off) existing debts.
- Incorrect information is a major culprit of new credit denial. The incorrect information could be the result of a minor error that was left unchanged. It is best that you monitor your credit report on a regular basis to ensure proper reporting.
If you have mistakes on your credit report and would like help in correcting them contact Credit Absolute and we will help you determine which mistakes are negatively affecting your score and help you resolve them quickly so that you are able to qualify for the credit you deserve.
Source: creditabsolute.com