How To Boost Your Chances Of Getting A Personal Loan

March 20, 2023 by Susan Paige
Obligatory stock art photo of a credit score.

Personal loans can be a valuable financial tool when you need extra cash for various purposes, such as debt consolidation, home improvements, or unexpected expenses. However, qualifying for a personal loan isn’t always a sure thing, especially if you have a less-than-stellar credit history.

In this blog post, we’ll discuss several strategies to boost your chances of getting a personal loan, ensuring that you can access the funds you need when you need them.

Improve Your Credit Score

Your credit score is a critical factor that lenders consider when evaluating your loan application. A higher credit score increases your chances of approval and may lead to more favorable loan terms. To improve your credit score, focus on the following:

  • Make timely payments on all your debts.
  • Keep your credit utilization low.
  • Review your credit report for errors and dispute inaccuracies. You can get collections removed by using DisputeBee.
  • Limit hard inquiries on your credit report by avoiding multiple loan applications within a short period.

Demonstrate Stable Employment

Lenders prefer borrowers with a stable employment history, as it suggests a steady source of income to repay the loan. Aim to maintain your current job for at least a year or two before applying for a personal loan.

If you’ve recently changed jobs, ensure that your new position is in the same industry and offers a similar or higher salary.

Reduce Your Debt-To-Income Ratio

Your debt-to-income (DTI) ratio is the percentage of your monthly income that goes towards debt payments. A high DTI ratio can raise concerns about your ability to manage additional debt. To lower your DTI ratio:

  • Pay off existing debts, such as credit card balances or other loans.
  • Increase your income by negotiating a raise, working overtime, or finding a side gig.
  • Avoid taking on new debt before applying for a personal loan.

Choose The Right Lender

Different lenders have varying eligibility requirements and loan offerings. Some lenders may have more lenient credit requirements or cater specifically to borrowers with lower credit scores. Research multiple lenders to find one that aligns with your financial needs and credit profile.

Provide Collateral

Secured personal loans require collateral, such as a car or home, which can increase your chances of approval. Offering collateral can also result in lower interest rates, as the lender’s risk is reduced.

However, be aware that if you fail to repay the loan, the lender can seize the collateral to recover their losses.

Apply With A Cosigner

A cosigner is someone who agrees to take responsibility for your loan if you’re unable to make payments. Having a cosigner with a strong credit history and stable income can improve your chances of getting approved for a personal loan.

Ensure that your cosigner understands the risks involved, as their credit will also be affected if you default on the loan.

Request A Lower Loan Amount

Lenders may be more willing to approve a smaller loan amount, as it poses less risk. Before applying for a personal loan, evaluate your financial needs and consider requesting the minimum amount necessary to achieve your goals. Be prepared to justify the loan amount in your application.

Prepare A Strong Application

A well-prepared loan application can improve your chances of approval. Gather all the necessary documentation, such as proof of income, employment history, and bank statements, before submitting your application.

Be honest and accurate in your application, as providing false information can result in denial or even legal consequences.


Getting approved for a personal loan can be challenging, especially if your credit history isn’t perfect. However, by following the strategies outlined in this blog post, you can boost your chances of securing the funds you need. Focus on improving your credit score, demonstrating financial stability, and presenting a strong application to increase your likelihood of success.

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