Loan refused: what are the possible reasons
Loan refused: insufficient income or precarious work
The income and the balance sheet are certainly the meters with which the bank measures the reliability of the applicant, for this reason, if they are not considered such as to guarantee the repayment of the loan requested, the latter will hardly be approved. A rule that lenders hardly violate pertains that the installment of a loan cannot be greater than one third of the applicant’s monthly income. Obviously, those who have a substantial patrimony can also make up for a not very high income, taking advantage of part of it (for example a valuable property) as a guarantee of the operation.
The job occupation of the applicant is another important factor in obtaining a loan, therefore a permanent contract guarantees the possibility of honoring the debt that is contracted with the bank, the same cannot be said in the case of a precarious situation or of a fixed-term contract and perhaps even close to expiry. As for freelancers, the bank will examine the latest tax return to get a more precise idea of the applicant’s repayment capacity and whether or not to grant the loan.
Loan refused: other financing in progress
When you already have more than one loan in progress, the bank is forced to deny the granting of further financing, in order to avoid exposing the customer to unduly excessive and no longer sustainable.
Having received a rejection in the previous 30 days
Those who apply for a loan and if it is denied, are reported within the Sic, which keeps this information for a total period of 30 days. This means that those who intend to apply for a loan again must wait for this period to elapse before submitting a new request to a bank.
The choice of the guarantor presented may also affect the granting of a loan, for example if the guarantor is a protested, a bad payer or does not have a financial situation capable of being able to settle the debt with the bank, in the event of insolvency from part of the holder, the loan is not granted.
Be the guarantor of a bad payer
Even if you meet all the requirements to obtain a loan, when you put the signature to act as guarantor in favor of a third party who does not respect the time in the payment of the installments, the bank ends up denying the granting of a loan to the same guarantor also if you have the status of a good payer.
Loan refused: being reported as bad payers
Banks always consult the reliability of a customer within the databases located in the Credit Information Systems, or the so-called Sic – Credit Information Systems-, it is a list that contains the names of those who have been considered a bad guy payer. This notification may for example depend on having delayed a payment for two or more installments of a previously agreed loan and there is a significant limitation because each institution is aware of it.
Sic also reports those who have not paid a bill of exchange on expiry and are therefore protested, this information is also reported in the register of protests , which as a public document can be consulted by everyone. In this case, the bank believes that it cannot rely on the borrower’s repayment ability and does not grant the loan.
Loan refused: it is impossible to verify the applicant’s reliability
Those who have never previously applied for loans are unknown to Sic, in this case there is the possibility that the loan will be denied because the bank does not find the necessary information on the applicant’s creditworthiness and therefore is unable to assess its reliability.
In any case, when a financial institution does not grant a loan to a customer, it is obliged to inform it of the reasons that led it to make this decision, also with regard to the negative data present in the Sic database, so that the applicant be aware of your situation.
Other residual reasons
Although less probable, there are additional residual causes that lead to the refusal of the granting of a loan, such as the appearance of a particular economic situation, which especially in recent years has weighed on these choices by financial institutions. Another cause is the application of stricter restrictive policies due to a reduced availability of liquidity by those who must disburse the loan or because of the cost of procuring the money considered excessive.