6 Ways to Improve Your Loan Approval Chances

The past few years have been challenging for consumers, but thankfully, the market is recovering. Auto inventories are up. Mortgage and loan rates have flattened. People are becoming more confident to make big purchases again.

These economic recoveries are certainly welcome, but we haven’t returned to the easy lending of past decades, especially in the case of housing. Buyers will still need to put in some effort to secure financing.

Here are six ways to give yourself a leg up on a loan approval:

1. Shore up your credit score
   Make sure your credit reports are accurate and your credit score is in good shape. A low score or errors on your credit report could delay your loan application or lead to its denial.

   
   

   Check your Experian®, TransUnion® and Equifax® credit reports for free every year by visiting annualcreditreport.com. Mountain America members with a checking account or loan also have free access to their credit score.

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2. Determine how much you can afford
   The last thing you want to do when taking out a loan is overextend yourself. To ensure you can make the payments, set aside a few minutes to run the numbers. Luckily you don’t have to use pen and paper to make these calculations anymore. Try our auto loan payment and mortgage payment calculators.

3. Comparison shop
   With big-ticket purchases, it’s common to shop around for the best price. The same approach should be taken with financing. Explore your options with a handful of financial institutions. We’re confident Mountain America has some of the best rates and terms in the area and will provide you with great service!

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4. Get prequalified
   Now that you know how much you can spend and which lenders have the best loans, you should request a prequalification letter. This document will not only show sellers your maximum borrowing limit, but also that you are serious about buying.

5. Have a cosigner or co-borrower
   If it’s difficult to qualify for a loan on your own, consider applying with someone you know and trust—typically, a friend or family member. With a cosigner, you are responsible for paying back the loan, and the cosigner only steps in if you are unable to make a payment. A co-borrower, on the other hand, is equally responsible for making loan payments—they also have ownership rights.

6. Take advantage of special offers
   As coupon-clippers will attest, a good deal can be a huge money saver. Auto and home loans may not have coupons, but discounted rates or special offers may be available.
   
   Moutain America members with MyStyle® Checking can receive a 0.25% rate discount on auto, RV and personal loans.¹

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