New Delhi, Business Desk. Credit score matters a lot when taking a loan. Due to good credit score, loan is available soon and there is also a possibility of low interest rate, but many times loan is not available despite good credit score. There are some reasons behind this. Whenever a lender gets an application for a loan, he checks whether the borrower will be able to repay the loan with full interest on time. The lender finds this out through several facts and if he has any doubt, the loan may be delayed or the loan deal can be canceled. Let us know what are the reasons, due to which good credit score can not get loan.
Ages
The age of the borrower matters a lot. Many times, loans above 60 years are not approved. Many times, people who have reached their retirement age are not eligible to take home loans or loans of more than 50 years with a duration of 15 to 25 years. The lender feels that the borrower will not be able to pay EMI after he retires.
monthly income
Monthly income is very important in any loan application. Whenever a lender receives a loan application, it assesses the repayment capacity of the applicant. This assessment is made on the basis of monthly income, stability of source of income and number of dependents. If your credit score is high, but your monthly income is low, there is a high chance of your loan application being canceled.
EMI and income ratio
The EMI-income ratio is seen by the lenders while sanctioning the loan. If the borrower’s total current EMI repayment amount is less than 50 percent of his monthly income, his chances of getting a new loan application are increased.
Job related things
Most banks and financial institutions demand at least two years of work experience for the loan lane. This reduces the risk of default. At the same time, if you are changing jobs frequently, then it is a sign of an unstable career. The credibility of such people is undermined.
