You, like most people must be wondering why your application for a loan got rejected. And there is only one answer: you failed to meet the requirements of the lender. The minute you apply for a loan, the lender gets to work by examining your application. The lender first of all checks if you explained the reason for your loan, then he sees if you are honest enough to disclose information about yourself and lastly he sees if you are able to manage your finances.

The minute the lender sees that your application is missing these three main ‘characteristics’, your loan application is rejected.

It’s advisable to consider the following before applying for a loan:

1. Always state the purpose of your loan. The lender requires a cover letter to fully understand the reason you have applied for a loan and know for sure that you won’t use the money in an illegitimate or illegal way. Your words should contain clarity and always give a brief and thorough explanation.
2. The lender also would like to know exactly when you will be able to pay off your loan. So don’t forget to mention that too. To do this you will be required to calculate your monthly income which will also include your taxes and subtract your expenses.
   This will give the lender the satisfaction that you will be able to pay off your loan in the given due period.
3. Give the lender a chance to understand you as a person. Therefore you have to include, in the letter, something about yourself. You needn’t go into every aspect but write enough about yourself so the lender can get to know you.you can include some details like employment, personal and financial history, academic excellence, volunter work etc.
4. Always make sure that you write the cover letter in a proper and professional way. For example the name and address should be on the top, right hand side. Make sure that you posses a copy of the letter. Always end the letter ina  courteous way e.g. sincerely yours or faithfully yours. If you are unsure about the letter its always good to get a second opion either form a friend or a relative.

Before handing in your application, make sure that you have all your documents and apaperwork at hand and that you have a copy of each thing for your own personal record.

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