Common reasons payday loans are declined in New Zealand

Payday loans are the easiest loans to qualify for however, there are certain deal-breakers that will see your payday loan being declined.

Just because it’s a payday loan doesn’t mean it's impossible to get declined whether you're looking for the loan from a bank or an online lender. 

You might have never personally been the one to apply for a loan, but the chances are that you know someone who has. Which probably means you know a bit about how they work and how convenient, they are for someone faced with a short-term financial crisis.

Why a lender may decline your loan application

These fabulous little quick loans are the answer to all your prayers if you need financial support in a hurry. The only thing is, don’t be fooled into believing that everything you deem as an emergency is going to be met with the same enthusiasm you have. There are a number of reasons that certain lenders might decline a loan application, even though you may feel as though you absolutely have to have this money and have no way around getting it apart from this solution.

I wouldn’t go so far as to claim that rejected payday loans are the norm, in fact, they are mostly approved. But, it’s still a good idea to familiarize yourself with the application types or reasons that are inclined to get rejected from time to time. That way, ignorance doesn’t get in the way!  

Your payday loan might be declined if:

1. The loan is for a luxury item

Payday lenders are not fans of lending money to those that aren’t in desperate need of the money and are borrowing to buy unnecessary items. So, a word of advice, avoid applying if it’s for something that you would like to have as opposed to something you have to have. Even though lenders are acutely aware of the issues that people go through, they strive to help those in real need as urgently as possible.

If your application states that you need the money for gambling or going away for the weekend, the chances are your application will be severely delayed. The only reasons for this are to protect you and your wallet. Borrow responsibly, and you’re sure to be met with a welcoming hand and approval for your payday loan.  

2. No proof of income is uploaded with your application

If your loan provider is a credible loan company, then they’ll definitely need to have proof of your current income prior to approving your application. The best way for them to do this is through your bank statements which you will need to provide. If you don’t have a bank account, it’s quite simple, your application won’t only get rejected, but you won’t be able to submit an application. Make sure you can provide these documents before you apply for a payday loan. It also goes without saying that you need an ID, but we thought we’d say it anyway.

Always do your best to cut back on expenses and save money by following a budget. Where personal finance is concerned, there’s no such thing as a fixed list of expenses, you can always cut here and there. Look where you can scale back and save on unnecessary day-to-day costs, or even better, where you can save monthly.  

3. You have an expired ID document

No matter the loan type, you absolutely cannot apply for a loan without a valid ID. Your ID will confirm your age, residential address and your valid citizenship. Your driver’s license or passport are perfect examples of what will work in this instance. If you find that your ID is a little outdated, then you’re going to have to sit back and wait for a decision regarding your application.

Instant cash loans are designed for people faced with serious cash emergencies. Emergencies generally translate to the very obvious – urgent need of funds! If you’re in a position where money is tight, and there is even a slight chance that you could run into financial trouble soon, then go over those important pieces of documentation such as your ID and make sure that it’s not out of date.

Ensure your loan application is approved

Responsible lending is fundamental when it comes to short-term loans and the borrower. The borrower needs to be fit to repay the amount owed. Certain loan providers that aren’t registered will not have your back financially, they’ll only have theirs. I don’t need to explain why this isn’t the ideal solution to cash shortages. One of the most important things is that your loan experience is as smooth and quick as possible.

Either way, you are now fully aware of the reasons you may encounter rejections for something as simple as a payday loan. Don’t be that statistic, get your loan approved the way you deserve, by ensuring that all the above don’t apply to you when you need a loan the most. Let payday loans get you from one payday to the next and avoid the drama of being rejected in New Zealand for something that could affect you financially if you haven’t prepared for it adequately.