While not all payday loan lenders post a credit report, some do. If you have bad credit or your debt-to-income ratio is too high, the lender may deny your application. The most common reasons you would be denied a payday loan (or any loan) would be your credit score, income, and past loan history. While many payday lenders serve borrowers with lower-than-average credit scores, some won't lend you money if they know you don't have the ability to repay the loan.
The main explanation why lenders reject applications for payday loans is that they believe you will not repay the loan. An extremely low score on your credit report, for example, can cause your payday loan application to be rejected. However, if your application was denied, you could get a payday loan from another lender. Before you apply, check out the most common reasons why payday loans are denied to make sure you won't be turned down next time.
A cash advance does not directly affect your credit score, and your credit history will not indicate that you borrowed one. However, the balance of the cash advance will be added to your credit card debt, which can hurt your credit score if you raise your credit utilization ratio too high. This ratio reflects the amount of your available revolving credit you are using. A high ratio can hurt your credit score, especially once it exceeds 30%.
If you try to borrow more than you can afford, the lender may deny your personal loan application. This is because the amount the lender approves you is based on your income and other debt obligations. After reviewing your finances, the lender may decide that you do not qualify for a loan of a certain amount. You can talk to your payday lender and ask them why your payday loan isn't approved.
Some lenders will tell you the reasons for the refusal of your loan application. If you realize the reasons why you were denied, you can take steps to increase your chances of being approved. If you find that your payday loan has been declined due to existing loans, you must pay them off first. If you continue to be denied payday loans online, you should evaluate the reasons why your loan application is declined.
If you know you'll have the money to repay the loan on time and you don't have other financial options available, a payday loan may be able to resolve your cash emergency. But cash advances come at a price, so don't rush into this decision without evaluating all other alternatives. The annual percentage rate (APR) charged to you for a cash advance may not be the same as the APR for purchases, and you can find it on your credit card agreement or by contacting your card issuer. Read the cardholder agreement to learn how much a cash advance will cost you before you consider borrowing one.
If you need a loan but are denied the beep, it might be worth going to broker sites (such as Cash Lady) or comparison sites. When you receive a cash advance from a credit card with an outstanding balance, your payments can be used to refund the purchase balance (which has a lower interest rate) before being applied to the cash advance balance (which has a higher interest rate). Unlike an unsecured loan, a secured loan is one that is backed by collateral, such as a car title or a cash deposit. If you live in a state that only allows one borrower to have one payday loan at a time, any outstanding loans could be grounds for refusal.
You don't get this luxury with cash advances; interest starts accruing on the day you receive the cash advance. Military members are also not approved for cash advance loans due to the Military Loan Act (MLA). Some of the reasons your loan application might be denied include a low credit score or low credit profile, a high DTI ratio, insufficient income, unstable employment, or a mismatch between the purpose of the loan you want to use the loan for and the loan purpose requirements of the lender. A cash advance could also affect your credit if taking on high-interest credit card debt makes it difficult for you to keep track of your bills.
And even those who offer cash loans, many look at their bank statement when signing up for their application. . .