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Loan Rejections Increasing
One fall out of the credit crunch, even though the number of cheap loans being promoted doesn't seem to have decreased, has been an increase in the number of loan applications being rejected by loan providers.
A recent report by the credit checking agency Equifax suggests that the secured loan application rejection rate has increased by around 10%, meaning that well over half the people who apply for a secured loan are being turned down.
It could be that the cheap loans people are requesting are just not available to them due to particualar personal cricumstances and that if they allowed a broker to research the market and come back with alternative suggestions, they would find a suitable loan option. On the other hand it could be that these people are simply not in suitable financial situations to allow them to undertake a secured loan. Perhaps they don't possess enough equity in their property for the loan amount they want, or they don't have enough residual income to fund the monthly loan repayments or their credit history is just not acceptable to the companies providing the loans.
The reason for the 10% increase however could be nothing to do with the type of applications being received. One major change we have seen recently is that a number of loan providers are no longer accepting cases that 6 months ago would have been fine. The level of risk they are prepared to accept from certain types of poor credit loan applications has reduced significantly and hence the level of loan rejections has increased.
Shopping around for a loan seems fairly straightforward on the internet, but using an experienced loan broker to work through that process for you is likely to be quicker and result in more chance of success.
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