Why can’t I get a loan?

There's no magic trick to getting approved for a personal loan, but there are some little-known ways you can avoid the rejection pile.

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Why can’t I get a loan?

There are a few common reasons why you may not be approved for a loan, but generally speaking, the reason you can’t get a loan will be because you don’t meet all of the lender’s eligibility criteria. This may because of things like your age, income, or overall situation, or because you’re completed your application form incorrectly.

Ultimately, when considering your loan application, lenders want to make sure you’re likely to repay your loan on time, and anything that marks you out as a risky borrower may prevent you from getting a loan.

What to do if you can’t get a loan

If you’ve been rejected for a loan, the first thing to do is confirm with the lender the reason your application was unsuccessful. Many lenders will automatically provide you with the reason you were rejected, but if not, it’s worth contacting them.

Once you’ve determined the reason you couldn’t get a loan, whether it’s because of your credit history, current financial position, or another reason, you should work to fix it before applying again.

5 tips to improve your chances of getting approved

  1. Don’t apply without checking if you’re likely to get approved. If you apply for a personal loan and are rejected, it’ll show up on your credit history. Multiple rejections may make it harder for you to get approved in future.
  2. Check multiple lenders in one go
. Blindly applying for loans directly with the lender can be time-consuming and counter-productive. Knowing where you stand with a range of lenders gives you a better idea of whether you’ll be approved. Click the green “Find a loan” button above to compare which loans you could get today.
  3. Get familiar with your credit history and what you can do to improve it. Many people don’t know their current credit score or even what’s listed on their credit history. There are a number of things you can do to improve your credit rating, from paying off existing loans to closing credit accounts you don’t use.
  4. Double-check your details before you hit apply. It may seem obvious but even simple mistakes on your application, such as putting in the wrong date of birth or address, can impact your chances of approval.
  5. Make the best case you can for yourself. Understanding your own financial situation and borrowing power is key to getting approved for a loan. While you may think you’ll be more likely to be approved if you apply to pay off your loan within a year, this may be seen as unrealistic by the lender and increase your chances of rejection. Always apply for a sensible amount, over a sensible term, for a legitimate purpose.

What’s the best reason to give for a personal loan?

Most lenders will let you apply for a loan provided it’s for a worthwhile purpose. This includes paying for a wedding, a car, a holiday, home improvements or to consolidate your debt.

While there is no “best” reason to put on your loan application, there are a number of things that you’ll be unable to get a loan for. This includes things like borrowing money for gambling, investing and any illegal activities. This also includes getting a loan that you then use as a down payment or deposit on a larger loan.

Ultimately, the reason you give on your application should be truthful. If you lie on a loan application, you’re likely to risk damaging your profile. Even if the lender believes you, if they find out at a later date, the loan could be called in. In a worst-case scenario, you could end up with a Cifas marker against your name (simply meaning you’ve been flagged in the fraud database as a potential offender).

Compare your personal loan options

Table: sorted by representative APR, promoted deals first

Will you be approved?

Check your personalised rates and likelihood of acceptance.
Name Product Total Payable Monthly Repayment Representative APR Link
Lending Works Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 5.8% p.a. (fixed) with an application fee of £0.00. Representative APR 10.0% and total payable £11,543.40 in monthly repayments of £320.65.
Barclays Bank Existing Current Account Customer Barclayloan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 5.5% p.a. (fixed). Representative APR 5.5% and total payable £10,848.60 in monthly repayments of £301.35.
Creation Financial Services Argos Unsecured Personal Loan
Creation Financial Services Argos Unsecured Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 9.9% p.a. (fixed). Representative APR 9.9% and total payable £11,527.92 in monthly repayments of £320.22.
Lloyds Bank Existing Customer Personal Loan
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.9% p.a. (fixed). Representative APR 3.9% and total payable £10,601.64 in monthly repayments of £294.49.
My Community Bank Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 23.9% p.a. (fixed). Representative APR 23.9% and total payable £13,678.20 in monthly repayments of £379.95.
Zopa Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 5 years at a rate of 8.8% p.a. (fixed) with an application fee of £240.00. Representative APR 9.9% and total payable £12,602.87 in monthly repayments of £210.05.
Hitachi Personal Finance Hitachi Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 3.5% p.a. (fixed). Representative APR 3.5% and total payable £10,539.72 in monthly repayments of £292.77.
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Name Product Total Payable Monthly Repayment Representative APR Link
Everyday Loans Personal Loan (fair credit)
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 34.4% p.a. (fixed). Representative APR 34.4% and total payable £15,269.04 in monthly repayments of £424.14.
Oplo Homeowners Unsecured Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 30.8% p.a. (fixed). Representative APR 30.8% and total payable £14,726.52 in monthly repayments of £409.07.
besavvi Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 18.9% p.a. (fixed). Representative APR 18.9% and total payable £12,913.20 in monthly repayments of £358.70.
118 118 Money Personal Loan (fair credit)
Check eligibility
View details
Representative example: Borrow £2,000.00 over 2 years at a rate of 35.9% p.a. (fixed). Representative APR 35.9% and total payable £2,710.32 in monthly repayments of £112.93.
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With no guarantor

Name Product Total Payable Monthly Repayment Representative APR Link
Likely Loans Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 59.9% p.a. (fixed). Representative APR 59.9% and total payable £19,010.16 in monthly repayments of £528.06.
Everyday Loans Personal Loan (poor credit)
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 58.4% p.a. (fixed). Representative APR 58.4% and total payable £18,795.60 in monthly repayments of £522.10.
118 118 Money Personal Loan (poor credit)
Check eligibility
View details
Representative example: Borrow £2,000.00 over 2 years at a rate of 99.9% p.a. (fixed). Representative APR 99.9% and total payable £3,804.00 in monthly repayments of £158.50.
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Compare up to 4 providers

With a guarantor

Name Product Total Payable Monthly Repayment Representative APR Link
Amigo Guarantor Personal Loan
Check eligibility
View details
Representative example: Borrow £5,000.00 over 3 years at a rate of 49.9% p.a. (fixed). Representative APR 49.9% and total payable £8,782.92 in monthly repayments of £243.97.
TFS Loans Tenant Guarantor Loan
Go to site
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 49.9% p.a. (fixed). Representative APR 49.9% and total payable £17,566.20 in monthly repayments of £487.95.
1plus1 Loans Guarantor Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 47.8% p.a. (fixed). Representative APR 47.8% and total payable £17,259.12 in monthly repayments of £479.42.
Bamboo Guarantor Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 69.9% p.a. (fixed). Representative APR 69.9% and total payable £20,421.36 in monthly repayments of £567.26.
Trusttwo Trusttwo (Tenant Guarantor) Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 36.9% p.a. (fixed). Representative APR 36.9% and total payable £15,644.16 in monthly repayments of £434.56.
TFS Loans Homeowner Guarantor Loan
Go to site
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 39.9% p.a. (fixed). Representative APR 39.9% and total payable £16,091.64 in monthly repayments of £446.99.
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With a guarantor who is a homeowner

Name Product Total Payable Monthly Repayment Representative APR Link
UK Credit Limited Homeowner Guarantor Loan
View details
Representative example: Borrow £20,000.00 over 3 years at a rate of 19.9% p.a. (fixed). Representative APR 19.9% and total payable £26,133.12 in monthly repayments of £725.92.
Trusttwo Trusttwo (Homeowner Guarantor) Personal Loan
Check eligibility
View details
Representative example: Borrow £10,000.00 over 3 years at a rate of 36.9% p.a. (fixed). Representative APR 36.9% and total payable £15,644.16 in monthly repayments of £434.56.
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Compare up to 4 providers

Please note: You should always refer to your loan agreement for exact repayment amounts as they may vary from our results.

Late repayments can cause you serious money problems. See our debt help guides.

7 common reasons personal loan applications are rejected

These are things you should avoid when applying for a personal loan:

  1. Bad or limited credit history. While all “bad credit” is usually pooled into one, there are varying levels of bad credit. For example, you may have never defaulted on any loans or credit cards, but you might have applied for a lot of loans in the past, or you may simply not have enough proof that you use credit responsibly. You can always check your credit score to see where you stand before applying.
  2. Insufficient income. The lender can’t approve your application if they find that your income and outgoings make your monthly repayments unaffordable. Lenders usually have a minimum income you need to earn in order to be eligible for the loan, so check the eligibility criteria. If they don’t have eligibility criteria, work out what repayments you’ll need to make and if these will be manageable on your income.
  3. Dubious loan purpose. Check that you’re able to finance what you need to with the loan you’re applying for. Many loans come with restrictions as to how the funds can be used, for example gambling, investing or using one loan as a deposit to get a second loan. If your lender finds out that your loan purpose isn’t credible, your chances of loan rejection could be quite high.
  4. Incorrect details. Lenders will usually verify the details you put in your application, and they may reject your application if they find inconsistencies.
  5. Unstable employment or insufficient employment history. Lenders are very meticulous about the stability of your job. Quite a number of lenders insist that you should have a stable job, otherwise they may reject your loan.
  6. You hold too many loans. If you’re currently holding several loans, this could give a lender cause to reject you.
  7. Low value of secured assets. If you’re applying for a secured loan, lenders have restrictions on the asset (normally a property) that you use as collateral, like age and condition, so if your asset doesn’t meet these requirements your loan could be rejected.

Things to consider when applying for a personal loan

  • Limit your number of applications. When you apply for a loan, the application is counted as an inquiry on your credit report. Too many inquiries can negatively affect your credit score.
  • Keep your credit report clean. You can make this happen by paying your debts on time and by not defaulting on any loans. It’s important to keep track of your financials and not take on loans you can’t afford.
  • Check your credit report. You should keep monitoring your credit report and ensure the information is up to date. You may need to dispute an error on your credit report if you find something incorrect

The bottom line

There’s no way to completely guarantee that your personal loan application will be approved. Even if you meet all the eligibility criteria listed by a lender, the lender can still reject your application at its discretion. What you can do is avoid common mistakes that lead to personal loan application rejection and follow the tips we’ve discussed to improve your chances of approval.

Frequently asked questions

Will you be approved?

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