You are floundering in a whirlpool of debt. Fighting and pushing to get out, at every turn is a new bill, another problem, and an increasingly poor credit rating. You are behind on bills. You just can't keep up. Checking the mail has become a routine of dread, fraught with the knowledge that people are after you, nagging at you incessantly to pay them and pay them now. In desperation, you applied for a loan at your bank, but they denied you and you felt humiliated, downcast. What should you do? Is all hope lost?
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You do have options. Applying for a loan at another bank may be the solution, but prepare yourself for the reality that this bank may deny you too. Banks today utilize highly refined and technologically advanced systems for processing loans, and you can't escape their thorough software. Try not to take it personally if a bank denies your loan. It isn't that they think you are unworthy and horribly ugly. Banks are just trying to save their tails from loan risk. The agent processing your loan uses an application processing system with a sophisticated business rule engine to determine your loan eligibility. The bank relies heavily on the business rule engine to make a choice about your application.
So take the sting out of the personal feelings of bank rejection. It's the application processing system, not the bank that is denying you.
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It's a numbers game, say some finance experts. When applying for a loan your chances are better each time you apply, especially if you focus on community banks. Community banks may be more willing to make exceptions in an effort to boost the morale in local citizens. Big banks are less likely to be sympathetic in providing options for people with challenging credit histories. A local bank needs your business, too. If you can prove to them that you have solid means to pay back your loan, they may forgive the evidence from their business rule engine. Ask yourself, how will I really pay this back? Will I need to take a second or third job? Take on extra employment for the short term and provide documentation of increased income to your bank. Arriving at the bank with a printed out plan of how you will repay the loan, plus verification of employment or promised gifts from relatives, can make for a convincing loan application. Think of your loan application as a job interview. A stack of neat documents can only help. While you're at it, wear your best suit.
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The immediate issue in your mind is getting a loan, but let's look deeper. Getting out of financial debt can only happen with increased financial education. Get financially literate, in other words. Don't beat yourself up for not understanding how to manage your finances, even if you are 80 and feel you should have mastered the topic long ago. You are not alone. 89% of Americans graduating from high school have had zero education in how to manage and plan for their financial futures. They can't even balance their checkbooks.
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Why isn't there financial education in public schools? It is an issue that citizens are outraged about. As our system currently is, parents, not schools, teach financial literacy. The fortunate few who have financially savvy parents are rarely victims of enormous debt. But the majority of our citizens are in the dark about finances, inheriting faulty systems from their in-debt parents. Get smart about how money works, and you'll get that loan.
