Apply to One Finance Company at a Time
Many credit scoring models take into consideration how many times you have applied for financing in a short period of time. To protect the lenders, some credit scoring companies lower your credit score with each inquiry. Thus, people who apply and get declined and then apply again hurt their chances of successfully obtaining financing.
Credit scoring companies do not want you to be able to borrow more than you can afford to pay back, so they assume each inquiry will be approved and drop your score a small amount.
There is no limit to the places you can apply nor is there a limit to how often you do so. However, it is recommended that only two applications should be submitted every six months in order to maintain your credit score.
Fill out the Loan Application Completely
There is nothing more important than answering all the questions. When you fill-out your application, answer every question and complete all the fields. Many lenders will penalize you for blank fields, so submitting a partial application may hurt your chances.
Answer Employment Questions with Care
If you are self-employed or own your own business, you may wish to use your professional title (President, CEO) and NOT “Owner” on the title field.
If you are in a trade that often changes jobs( i.e., plumber or carpenter), you may want to reference your years with a union or trade organization rather than your latest job.
While dependent information and marital status are not required, it is a good idea to complete these fields. If YOU are a woman and recently married, be sure to hyphenate your last name so that at least one last name matches your credit report.
The Right Relationship Matters
Be sure to include all sources of income, not just your pay, in the gross income field. This might include rental income, social security, or money from a trust. List only the required minimum payments, even if you are able to pay more. When payments, like rent, are shared, include only your portion of the payment.
Make Your Answers Count in Your Favor
If you have not been at your present address for more than 3 years, you may be asked to provide a previous address over the phone after submitting your initial application. Make sure to use the address that will show on your credit report even if that address is not used for mail. It is important that you avoid using a PO Box.