Banks can refuse to grant a loan without giving any reason. But what to do if you need money? We tell you what are the ways to get money.

Why does a bank refuse a loan?

Banks consider various factors while examining a loan application. But there are parameters that all financial organisations take into account.

• Credit history. If it is bad or there is no credit history, the bank may refuse to issue a loan.
• Presence of other loans. Banks will refuse if you have a high debt load.
• Solvency. The bank checks the size and stability of your income to eliminate the risk of default in the future.

How to increase the probability of loan approval

• You can influence the bank’s decision on the application if you provide a flat or a car as collateral. For the bank, this is an additional guarantee of repayment.
• Try to attract a creditworthy guarantor or co-borrower with a good credit history.
• Open a deposit, if you have savings, or transfer your salary to the bank where you want to apply for a loan.
• Open a credit card for a small amount and pay off your debts on time. This will show the bank that you are willing to pay correctly.
• Do not default on existing loans.

How else can you get money from a bank?

A credit is not the only way to borrow money. There are other options.

Credit card

A bank may be willing to approve a credit card instead of a loan. It is more suitable for small everyday expenses, whereas a loan is usually for a larger amount and for a longer period of time.

Paying by instalments

If you want to buy a mobile phone, for example, apply for an instalment plan from the shop. If approved, the bank of your choice will transfer the payment to the shop.

Car loan

If you want to buy a car, you can apply for an auto loan. If you are turned down for a conventional loan, you may be approved for an auto loan.

Overdraft

An authorised overdraft is a debit card loan. You can use more than the amount you have in your debit account.

Loan from a microfinance organisation

Microfinance organisations provide short-term loans for small amounts. Usually you only need a passport to apply. Sometimes they may ask you to provide a second document. Before applying for a microcredit, be sure to check the organisation’s registration to find only organisations that operate legally.

Other products from banks

Banks may offer personalised loan services that are different from conventional loans and credit cards.

Where else can I borrow money?

If you need money but don’t want to go to the bank, consider other options.

Borrow from loved ones

Relatives, close friends or colleagues are sometimes willing to help with money. And if you decide to borrow money from them, remember that finances can cause the breakdown of your relationship with these people. Therefore, think in advance how you are going to repay the money and discuss all aspects: what amount you need, what you are going to spend it on. In order to borrow money and maintain a close relationship with the person, offer to write a receipt for the debt and have it legalised by a notary.

Sell property

If you need money, you can sell something you own, such as a flat, car, appliances, furniture, collectible coins and more. When you sell things, always consider the urgency and the amount you need to pay off your debt. If you need the money right now, for example, to pay off debts, you can try selling the car if its value will cover the debts.

Renting out the property

You can save the amount you need by renting out your property. For example, rent out your flat if you have the option of living somewhere else.