3 Easy Tips to Get a Personal Loan During the Pandemic This 2020November 19, 2020
The economy throughout different parts of the world continues to suffer from the devastating impact of COVID-19. Unemployment rates are at an all-time high, while industry-established businesses struggle to keep the lights on as national quarantines limit social interactions to curb the spread of the coronavirus.
This is the time when people need enough financial reserves to brace through the uncertain future. Still, the shaky economy makes it even more difficult to cover emergency funds and other large expenses.
During this cash-strapped moment in history, people can ease their financial anxieties by taking out personal loans. However, it helps consider how banks and lenders will practice caution more than ever before. The tips below should give a rundown on ways to increase your chances of getting approval for your loans:
Tip #1: Proof of a Stable Income
Now that a recession is looming on the horizon, lenders will be stricter at verifying your income, along with a more extended income history.
Borrowers no longer need to show proof of employment, but lenders will focus more on the salary since not all jobs can guarantee a stable payment.
For example, doctors, engineers, and accountants will have a lower risk than applicants who are photographers, freelancers, and other job titles with lower income stability.
Tip #2: Save Enough for Extra Cash
Another way to boost the likelihood of taking out a personal loan is to free up extra cash to ease a lender’s worries regarding your commitment to repay the loan. Before the COVID-19 outbreak, lenders typically consider 40 to 50 percent of the borrower’s debts, so determining your debt-to-income ratio should reveal how much your income goes to other creditors.
Suppose you still have extra cash after paying all other expenses each month. In that case, lenders will likely favor your application since it shows that you can adjust your spendings to pay off any debts responsibly without exhausting your savings.
Tip #3: Maintain a Good Credit Score
Keeping up a good credit score has always been a critical factor for lenders, but banks and lenders are becoming increasingly strict with the requirements since the pandemic. Missing payments over the last months is a bad image for lenders, and with the volatile economy, the lenders need assurance that you can ultimately pay them back thanks to the crisis.
The Bottom Line: Obtaining Financial Support in a COVID-19 Economy
COVID-19 has undoubtedly put the economy in a significant downturn, making it trickier to secure a personal loan, especially since it doesn’t require collaterals. Meeting the requirements above should improve your eligibility, though other options such as the coronavirus hardship loan for those who need a small amount of emergency assistance.
How can we Help Cover for your Needs?
Applying is a loan that can be a time-consuming and complicated process. We can still help take the drudgery away from achieving your financial needs with our smart online application systems at Hoopla Loans.
If you’re looking for fast, easy loans in South Africa, we’re an ever-evolving online loan broker that can bridge the gap and help you build an impressive credit history. From affordable loans, bad credit loans to emergency loans, we can provide the coverage you need to obtain your goals.