Credit is a powerful tool that can help you achieve your goals, build wealth and meet your urgent needs. Therefore, it’s important to understand how a loan is approved. I.e the factors lenders consider to evaluate your application and make a loan decision.
Most of these factors, we’ve hinted at in other articles, but some of them are quite new, and paying attention to each of them and making sure they’re right before your application, would be key to getting you that loan.
Debt to income ratio
DTI is your debt-to-income ratio – it’s a percentage that compares how much you earn every month (before taxes) to how much you owe. It helps show lenders how much of your income you spend repaying loans and therefore gives them a good idea of whether you’ll struggle to pay back your potential loan or not.
The lower your DTI, the better DTIs of about 50% may not even be considered by lenders, unless the applicant has a solid repayment history – so it’s best to aim for within the 30% range when considering your DTI.
Credit History
Your credit history shows how well you’ve paid off all your previous loans in the past and gives you a score between 300 and 850 based on how well you take loans and repay them.
Your credit reports are hosted on National Credit Bureaus which are available to individuals, and the lenders who will assess your loan application. Here is a table showing how the scores are ranked for your credit report:
- 720+: Excellent
- 719 – 690: Good
- 689 – 630: Fair
- 629 – 300: Bad
You want to make sure that when you’re applying for a loan, your credit score is above the fair range (630) and not below it. As this is one of the most popularly used methods for loan providers to decide if you get your loan or not.
Consistent income & Cash flow
To be confident you can pay back the interest on your loans, lenders want to be sure that you’re receiving consistent income or earnings in your accounts every month. So, you want to make sure that any bank account information you’re providing shows a steady income coming into your account over at least 6 months.
But that’s not all – Lenders don’t just look at what’s coming into your account to make a lending decision – they also look at what’s left in your account after a specific period every month, quarter or year. This is known as your cash flow, and it can be defined as the balance between your income and expenses over a certain period.
Complete information
Lenders will often ask you for some information and documents when you apply for a loan, and while this may scare some people, some of these documents are essential to making an accurate decision about your loan and getting you approved. Some of the documents you may be asked for include BVN, Utility bill, Next of kin details, etc.
So now that you’re more equipped on how loans are approved, you can apply for a quick loan of up to ₦200k by clicking here or get more money when you call us on 0700 5000 500 😊.
22 thoughts on “How Loans are approved”
How can I get my loan
Hi there, We're sorry for taking this long to get back to you.
You can easily apply via the website www.renmoney.com or by downloading our mobile app from your device store.
Pls help me true with this loan application, pls I really need it and I we return it early next month is very urgent
Hi Rasaq, please reach out to any of our social media platforms and an agent will help you out.
Renny app Is a good app but help me too
RENNYMONEY APP IS A GOOD APP
Thank you, Rasaq. We appreciate comments like this! 😊
My loan has not been approved and I always pay back before the due date
Why is it saying you cannot add this account?
Hi there, we're sorry for taking this long to get back to you.
Please send a mail to app@renmoney.com so we can provide more information.
Good morning, please how do I know how much loan will be given to me.
Hi Faith, we're sorry for taking this long to get back to you. Please send a mail to app@renmoney.com so we can provide more information.
Dear Renmoney Team,
I am writing this letter to formally apply for a loan to the tune of #2.2mil from your esteemed organization. I have carefully considered my financial needs and have identified two specific reasons for requesting this loan.
Firstly, I require financial assistance to clear a consignment of food supplements. By obtaining the necessary funds, I can ensure the timely clearing of these products.
Secondly, I intend to utilize a portion of the loan to invest in the digital marketing of Sunday School management frames and boards. By implementing an effective digital marketing strategy, I anticipate a significant increase in the visibility and sales of these products. This growth will not only benefit my business but also contribute positively to the Sunday School community.
If my loan application is approved, I assure you that I will diligently repay the loan within a period of ten months. I am committed to meeting all the terms and conditions stipulated by the organization and will adhere to the agreed-upon repayment schedule.
I appreciate your time and consideration, and I hope that you will look favorably upon my loan application. I am confident that with your support, I can successfully address my business needs and contribute to the growth and prosperity of my enterprise.
Thank you for anticipatedcooperationandsupport.
Sincerely,
Aje Clement
Hi Clement, we're sorry for taking this long to get back to you. Please send a mail to app@renmoney.com so we can further assist you.
I have been trying to get a loan from this platform , but never being able ever since over three years.
Hi Victor, we're sorry for taking this long to get back to you. Please send a mail to app@renmoney.com so we can help you sort this out.
I have been trying to apply for loan yet the app is not function.... please I need help with this
Hi Faith, we're sorry to hear this and we would love to take a look at the issue. Please send a mail to app@renmoney.com so we can sort this out quickly.
Hi Faith, we're sorry for taking this long to get back to you. Please send a mail to app@renmoney.com so we can help you sort this out.
Incomplete process yet I can't access the loan and a message was sent to me yet nothing.
Infact chatting with renmoney team on the app is totally not helping at all,it's frustrating
Hi Faith, we're sorry for taking this long to get back to you. Please send a mail to app@renmoney.com so we can help you sort this out.
Hi Faith, we're sorry for the delayed response and we would love to take a look at the issue. Please send a mail to app@renmoney.com so we can sort this out quickly.