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Denying Loan for 850 Credit Score: What To Do?


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In today’s world, credit cards play an important factor, and in turn, our credit scores determine much of our lives. Reaching or having an 850 or excellent credit score is the toughest task, but achieving it is possible.

However, even after reaching an excellent credit score, that does not guarantee that you will get approved for a new credit card. One of the worst things that could happen is that, denying loan for 850 credit score which is the most unfortunate experience.

Of course, it’s important to understand why you may be denied a loan with that credit score, and what should be done while denying loan for 850 credit score in this article. 

Reasons for Denying a Loan for 850 Credit Scores

An excellent credit score is a major factor in financial trustworthiness, but it won’t help you get a loan by itself.

Creditors will not only look for your credit rating, but also look at various factors to determine your creditworthiness.

The reasons why you may be denied a loan include the following::

No Proper Income

When talking about credit scores,  the payments, debts, or bankruptcy tells the creditors a significant amount, but your income doesn’t come under this picture.

In most cases, creditors have a minimum income requirement. If your income is less than the creditor’s cut-off, this tells the creditor that you may face a tough time paying the new debt.

It is good to understand your credit history before applying for a loan.

Debt-to-Income Ratio is High

Your debt-to-income ratio compares how much you owe each month to how much you earn. It is nothing but the percentage of your gross income to the payments for the debts like credit cards, rent, or mortgages.

Even if you make a decent amount of money, high monthly debt repayments may indicate financial instability and cause lenders to consider you a risk.

Employment History

If your employment history is not good, then it is the biggest drawback in getting a loan.

Even though your credit line is good, there is a high possibility of denying loan for 850 credit scores.

Creditors will look for consistent employment for at least two years and will verify your employment before approving your loan.


The creditors will ask you for your savings or any other cash you may have.

Showing that you have money set aside assures creditors that you have the means to make your loan payment if an unexpected expense comes up.

Late Payments or Collection Accounts

Some negative items, like late payments, missed payments, or collection issues, will have small or no impact on your credit scores, but it is a drawback for the creditors. Unpaid debt leads to denying loan for 850 credit scores. Creditors will ask you to clear all your debts before they approve your loan.

For example, if you have cleared all your credit card bills on time to build a good credit history, but if you missed a couple of payments, it will fall into the creditor’s eyes.

This results in hurting your score more and will lead to poor credit history. You need to start it from the beginning to build a good credit history.

If your score is higher, and it suddenly falls down, it will damage your credit history and creditors may denying loan for 850 credit scores.

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What Should I do after Rejection?

Even if a creditor denies your loan, that doesn’t cut you off from getting a loan or a credit card in the future. Denying loan for 850 credit scores happens, but the way you can get out of this is by analyzing the reasons why you were denied. 

Once you understand the reasons why you were denied, there are other steps you can take. 

Find Another Creditor

By surfing around, and investing in some time you may find a few flexible lenders with different requirements from the ones that denied you. Of course, you should not talk about any reasons for the previous denials with the lenders you speak to. While it is always better, to be honest with your creditors, your loan might get approved with high-interest rates and restrictions.


If you have a co-signer along with you, then the chance of denying loan for 850 credit scores is less.

It is not necessary that a co-signer has excellent credit, but they play a responsible job.

This includes taking full responsibility for debt payments when payments are suspended. 

Take Some Time to Recover

If you are facing any debt-to-income ratio issue or any other financial problems, prioritize fixing that. If you settle those issues and come back to apply for a new loan, you are less likely to be denied again.

Your savings will give you a helping hand in recovering. If you have savings in your account, then you can handle any difficulties in a responsible manner.

The main solution is to give yourself some time to settle those issues so that you can concentrate on getting your loan without any denials.

Have a look at your credit report

Denying loan for 850 credit score is a big issue, but having another look at your credit report may help you overcome that issue.

If a creditor runs a credit check on your credit report, then it falls under hard inquiry. To overcome that, it is better for you to check your credit report.

Check Your Credit Report!

You may get a free credit report from all three credit bureaus. These are Experian, Equifax, and TransUnion.

In case of any disputes or help regarding your credit report, contact The Credit Pros. They educate their clients by helping them understand their credit reports and score.

Reconsideration Request

While denying loan for 850 credit score, and you found out an error in your loan application, then you may call your creditor and ask them to reconsider your request. 

You may talk about the issue and it could be rectified easily, by making a request to the creditor. It may be the case that the creditor might not notice the issue.

When you speak to the creditor, you should have clear points to talk about the issue. If the creditors see your point, then it will be good to accept their response.

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Building a strong credit history will help you in getting your loans. Denying loan for 850 credit scores might hurt you a lot, but that does not mean you may not get loans or new credits.

You must build up a place of comfort to reapply for that loan.

Please keep in mind that it is not good to open or close any of your credit accounts or make any financial changes when your application is under consideration.

Frequently Asked Questions

Can a loan be canceled after signing on it?

You may cancel some loans after signing them. For some mortgage loans, you cannot cancel your loan after signing the closing documents. 

What happens if your loan application is denied?

Contact the lender if you don’t understand the reason. Once you have requested an explanation, the lender will provide you with the specific reason for denying the loan.

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