10 Reasons a Payday Loan Might Turn You Down | Oak Park Financial

If you’ve ever had to turn down a payday loan you’re likely wondering why. Here’s a list that outlines the most frequently-cited reasons the lender could reject your payday application for a loan.

1. You Don’t Meet the Application Requirements

Each lender has a set of basic standards each applicant must satisfy. Usually, lenders will only accept applications from those that are 18 years old or older and are United States citizens. Some direct payday loans online may have a higher threshold of 21 years old.

2. You Can’t Prove Your Income

To be eligible in the event of a cash advance you’ll need to be employed and receive at least a monthly paycheck. The lender won’t accept your word on it as well, so you’ll need to provide a couple of pay stubs or a bank statement proving direct deposits taken at your workplace to prove. Some lenders might be willing to take Social Security as income; however, a majority of them will deny applicants who are self-employed or work independently, and any applicants employing a temporary agency.

3. You Don’t Make Enough Money

Even if you’ve got employment and can show your earnings, however, that doesn’t mean you earn enough to be eligible for a payday loan. Certain lenders require applicants to earn a minimum of $800 per month. In certain cases, welfare and unemployment are considered as provided that there is other income that places you in excess of the minimum income requirement of the lender. It’s best to check if you meet the criteria of the lender prior to submitting an application.

4. You Don’t Have a Checking Account

The payday loan companies typically will require borrowers to bring an unpost-dated check or complete an ACH withdrawal to pay back at the time of loan due. If you do not have an account with a checking account, you won’t be able to make this payment and your loan application is likely to be rejected.

5. You Have Other Payday Loans or Paycheck Advances

If you’ve got remaining payday loans or paycheck advances, lenders will be skeptical about accepting your request. This is true regardless of whether the advances or loans are due or not because a payday loan could only make your debt more.

6. You Have Blemishes on Your Accounts

If a payday loan provider finds a string of bank overdrafts on your statement, he might decide not to approve the loan. This is also the case when there is a credit investigation is conducted and bankruptcy appears on your credit report. These marks show that you’re more prone to risk and you may never be in a position to repay the loan.

7. Your Credit History is Poor

Although not all payday loan lenders check a credit file, the majority do. href=”https://www.mycreditsummit.com/payday-loans-credit-score /”>. If you’ve bad credit or your debt-to-income ratio is too high, the lender could refuse your application.

8. You Don’t Meet the Lender’s Additional Requirements

Certain lenders have general requirements for applicants however, others have a more extensive list. For instance, there are payday loan companies that require applicants to connect to a fax machine as well as give a valid phone number. They can also ask for evidence of residency. Although your application could be rejected by the lender you are applying to, however, it might be approved by a different one that has less stringent requirements.

9. You Make Payments to Gambling Sites

If a payday loan provider examines your bank statements and discovers you’ve made gambling websites online or casinos, they could deny your application. The lender might decide it’s not worth paying for your bills, you’re risking your cash by playing the game which could result in a deficit to pay back your loan.

10. You Could Be Facing Discrimination

However, discrimination is still a problem. It is important to review all of the reasons that led to the rejection and ensure you aren’t in any of these categories prior to you deciding to consider discrimination as the reason behind your application being rejected. If you believe that the payday lender has made a discriminatory decision against you because of your religion, race, or impairment, you are able to submit a complaint to the U.S. Department of Justice Civil Rights Division.

About Mike Crayton

Check Also

Factors that can influence interest rates on gold loans

Gold loan is a type of secured financing option that allows you to borrow against …