The reason your personal loan application gets rejected – Private sector employees
May 29, 2021 by AmwalCom
If you work in one
of the private sector companies in Jordan and you receive your monthly salary
through your bank, you might consider getting a personal loan from a bank.
However, the process is not as simple. You might be surprised to know that you
might get your application rejected for any of the following reasons:
This could be the main reason your application gets rejected. The first
step banks take is checking your credit report on CRIF Jordan. If there has
been a falter in your credit report, you have little to no chances to get your
loan application approved by the bank.
You can get a free copy of your credit report from CRIF Jordan once a
To get a personal
loan in Jordan, your salary should be higher than the minimum salary required
by the bank. For example, if the minimum salary required is 500 JDs and your
salary is 400 JDs, you will most probably get your application rejected.
All banks in Jordan
ask that your salary gets transferred to them before getting a loan from any of
them. If you cannot transfer your salary to the bank you are applying for, your
application will most probably get rejected even if you have a good credit
report or a good salary above the required.
Banks in Jordan
have a list of accredited companies. If your company is not among the listed
ones, then you might be asked for any of the below extra collaterals to get
your application approved:
- A salary higher
than other employees working for accredited companies
- A higher interest
- A shorter financing
You can ask the intended
department in your company about the banks your company is accredited in. You
can also apply to get your company accredited by the bank.
Debt Burden Ratio
This is the ratio
that indicates how much of your salary is deducted for financial commitments.
It is usually around 50%, meaning that a maximum of 50% of your salary should
go for your financial commitments.
For example, if you
have a salary of 500 JDs, the maximum monthly amount that can be deducted from
your salary is 250 JDs. If we assume you have an existing commitment for 100
JDs/month, then the bank can give you a loan with a maximum monthly payment of
150 JDs. The maximum loan amount you can get is calculated based on this. Accordingly,
if you are asking for a larger loan amount, your application will be rejected.
Service period and social security statement
Banks usually ask
for a minimum of a 6-month experience in the company you are working for before
applying for a loan. Therefore, banks will be asking you to provide a bank
statement and a social security statement for the past six months.
If you are asking
for a loan amount that is higher than what can be given to you, then you will
get your application rejected. This is usually calculated based on a banking formula
with the interest rate, financing period, salary, exiting commitments and DBR
If you think you are eligible for a personal
loan, you can compare between personal loan offers here