If you’re finding that your credit score, DTI and overall finances don’t qualify you for the loan amount you need, below are some strategies you can try out to boost your chances of getting your desired loan. Interest rates and terms – as well as loan amounts – vary by lender, so it’s a good idea to shop around with multiple lenders before deciding on a particular loan. If you already belong to a bank or credit union, going through those institutions can work in your favor since members may be able to qualify for loans they wouldn’t elsewhere.Shop Around With Different Lenders
Getting prequalified with a lender before submitting a full application will likely give you the most accurate estimate of the rate, term and loan amount you qualify for.
Increase Your Income
Boosting your regular income and lowering your DTI can help you qualify for more loans. You can lower your DTI by making more money, perhaps through a raise at work or a new side hustle. Either way, a higher monthly income can make it easier to qualify for a larger loan amount.
Improve Your Credit Score
Since lenders put so much emphasis on your creditworthiness for personal loans, taking steps to improve your credit score can open up more loan possibilities for you. Maintaining good credit, or excellent credit if you can, will help you qualify for larger loan amounts.
Pay Down Existing Debt
Having a lot of outstanding debt can raise your DTI, so paying down any debt you owe can naturally lower your DTI. For instance, you could pay off credit card debt, a mortgage, an auto loan or a student loan, and not only be free of that debt but possibly be able to qualify for a large loan. Research different strategies for paying off debt and find the best solution for your situation.
Use A Co-Signer
A co-signer is someone who agrees to add their name to a borrower’s loan application and be financially responsible by law to repay the loan if the borrower defaults on it. Having a co-signer – who, typically, is in a better financial situation than the borrower – can assure a lender the loan will be repaid one way or another, which could result in a higher loan amount.
Be sure to consider all the possibilities before co-signing a loan, though. You could put your finances at risk if the borrower falls behind on their payments.
Rocket Loans doesn’t currently offer the option to co-sign on loans.
