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How to Improve Your Chances for a Bank Loan

– Posted in: Managing Your Finances, Money Management, Smart Banking

Going to get a bank loan is a stressful thing when we go in unprepared. There is really nothing to be nervous about as long as you prepare for the meeting ahead of time. The banks make money by providing a service like everyone else, so they want to do business just like you do. Here are five things you can do to increase your chances of both getting the loan and staying relaxed throughout the process:

How to Improve Your Chances for a Bank Loan

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Educate Yourself About the Process

With the advent of the computer, you can learn about anything rather quickly and accurately. Get online and learn about the lending process in general. Knowing what to expect is a great way to be totally prepared and relaxed. It also will guarantee that you have the maximum chances of getting what you need. Knowing how to ask and what to provide is half the battle.

Visit Several Lenders

Like any other business, you should shop around before committing to a loan. You are the one that is providing value to the lenders and you should look around for the best terms and conditions. Never commit out of a perceived lack of options. There are options for everyone out there these days.

Have Your Financial Papers in Order

Now that you know what you need, you need to present in a neat and easy to read fashion. Yes, the bank will go through and do their own legwork on your financial background. Still, if you bring it all in a transparent manner, it will bode well for their perceptions of you as a potential client. Bring bank records, credit information and income at a minimum.

Show How the Money Will Be Used

Banks and lenders like to see how you plan to use the money sometimes and particularly so if you are using the loan for business. Be upfront with this information and you will increase your chances of getting the loan. If you are borrowing to make money, show how that will happen. Business plans can help both personal and business situations. There is nothing wrong with sharing your plans with the people who are funding them.

Clean Up Your Credit Rating

Before you ever go to the bank and see about a loan, you should investigate your credit rating and do what you can. If it is poor, then take the steps to clean it up to the best of your ability. This will give you more options and make the options more attractive as well. Everyone can do something to improve their credit rating. Go in with your best foot (credit rating) front and center.



12 Comments… add one
jordyn @ Almost Supermom December 17, 2013, 3:27 pm

Great tips!! After just having gone through this process a year ago, I know how incredibly stressful it can be… It is so much easier if you are prepared.

Vinma December 17, 2013, 5:59 pm

Yes, preparing and doing your home work is really important when applying for loans. It could make the process a lot smoother.

Megan S December 17, 2013, 4:41 pm

Having the right papers with you are so important. They are all great tips, thanks!

Vinma December 17, 2013, 5:56 pm

Thank you for stopping by Megan. Yes, I can’t stress enough the importance of having your papers in order.

Jessica December 17, 2013, 5:43 pm

I agree with Megan! Having the right papers are so important otherwise things will be delayed or you won’t be approved.

Vinma December 17, 2013, 5:58 pm

Jessica! Managing your papers are always a headache. But well worth the effort when you approach the bank. Realizing this and doing the needful makes you win half the battle 🙂

Cher December 17, 2013, 10:02 pm

Fabulous advice! I have never applied for a loan before in my life and your tips will certainly help out when that time comes around! Thank you for sharing!

Robin (Masshole Mommy) December 18, 2013, 10:21 am

Great tips! I think people think they can just walk into a bank & get a loan, but people really have to do their research first.

becca December 18, 2013, 11:13 am

great tips here I am needing to clean up my credit score after filing for bankruptcy over a year ago

Jessica December 18, 2013, 2:02 pm

I love this advice! I have not applied for a loan before, but I am passing your tips along to a friend who is currently going through the process for educational purposes.

Kristen from The Road to Domestication December 18, 2013, 3:34 pm

Great tips, thank you! I’ve never had to do this before, but who knows what the future holds!

Sarah Bailey December 18, 2013, 7:25 pm

Fantastic tips – I would have had any idea on where to start if I ever needed to apply for a loan. 🙂

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