Engineer Your Finances

A Systematic Approach To Money

  • About Us
    • Disclosure
    • Privacy Policy
  • Contact Us
  • Toolkit
  • Security
    • Credit & Debt
    • Banking & Saving
    • Psychology
    • Other
    • Optimization
    • Education
  • Self Discipline
  • Improve Returns

Common Reasons For Credit Application Denials

Share

If you have never had a credit application rejected, consider yourself fortunate. Nearly 70% of credit applications are routinely denied by creditors across the nation for a wide variety of reasons. When a credit application is turned down, it is important for you to know why. Here are some of the most common reasons for credit application denials.

Ratio Of Credit Used To Credit Available Too High

If you are using a high percentage of your available credit, it may be a reason for a credit to deny your credit application. If your credit balances are more than 50% of your credit limits, it signals to lenders that you may be having trouble paying your existing debts, making them more reluctant to extend additional credit to you. To make yourself more attractive to lenders, focus on paying down balances that are close to the credit limits as quickly as possible.

Too Many Recent Inquiries

If your credit report has been pulled by lenders numerous times within a fairly short time period, it could be the reason for the denial of your credit application. The impact of inquiries on your credit will vary depending on your overall credit profile, but the typical inquiry will affect your score by about five points. Only certain types of inquiries are counted like this. Checking your own credit reports does not count; nor do promotional inquiries, inquiries from employer and insurance companies, and account reviews by your current creditors. Avoid opening large numbers of retail credit cards and limit your searches for additional credit to when it is absolutely necessary.

Account Delinquencies

A large number of late or missed payments in your credit history will cause a drop in your credit score and cause most credit applications to be denied. Lenders want to lend to people that will pay back the amount borrowed plus the interest owed with a minimum of hassle. If you cannot demonstrate a good payment history, there is a good chance that you will not be able to get additional credit. Negative account information is generally listed on your credit report for seven years, and if the information is accurate, there is little chance that it will be removed from the report.

Collection Filed

If you have a bankruptcy, judgment, tax lien, or collection account listed on your credit report, it could mean the automatic rejection of your credit application. Collection accounts may be reported on your credit report for seven years and 180 days from the date you first fell behind with the original creditor. Paid judgments and paid tax liens can be reported for seven years, but unpaid judgments and tax liens can remain on your report indefinitely. Paying a collection, judgment, or tax lien could result in the public-record item being removed from your credit history sooner and protect you from being sued for the unpaid debt.

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

FOLLOW US

Join Our Newsletter
  Thank you for Signing Up
Please correct the marked field(s) below.

1,true,6,Contact Email,21,false,1,First Name,21,false,1,Last Name,2



Our Favorite Posts

  • How Much Interest Does 1 Million Dollars Earn Per Year? by Trey LaRocca
  • 3-Month Performance Review by Fin Engr
  • Rooting Out The Devil: Kathy Kristof Interview by Fin Engr
  • Money Hackers Carnival #117: Wedding & Marriage Edition by Fin Engr
  • Interview: What’s it all about? More than Money! (Part I) by Fin Engr
  • How to Compare Rates for Mortgage Refinancing by Fin Engr
  • Want To Erase Bad Credit Instantly? 6 Hacks That Work Fast by Trey LaRocca
  • FinEngr Joins The Million Dollar Club by Fin Engr

Blogroll

  • Blonde and Balanced
  • Budget and the Bees
  • Cash Cow Couple
  • Cash the Checks
  • Clever Dude
  • Dinks Finance
  • Enemy of Debt
  • Get Rich Slowly

Categories

Our Friends



Great Investing, Simplified: Get Stock Advisor for Just $99/year!

Need to find a loan? Got a Car? Compare title loan offers near me and get the best rate.

private real estate investors

Order custom essay from professional essay writers.

Visit 123 Term Papers and you’ll receive help from the qualified writers.

Thesis writing help for all the students!


Deprecated: genesis_footer_creds_text is deprecated since version 3.1.0! Use genesis_pre_get_option_footer_text instead. This filter is no longer supported. You can now modify your footer text using the Theme Settings. in /home/engine16/public_html/wp-includes/functions.php on line 5236

Copyright © 2021 · Runway Pro on Genesis Framework