How can you get an unsecured line of credit?


Quick Answer

To get an unsecured line of credit it is necessary to be employed, not have too much debt already, have a good credit rating and have a history of paying bills on time. You should also have necessary documentation to provide to the lender before you shop around and complete an application.

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Full Answer

  1. Have steady employment or other source of income.

    Unsecured line of credit lenders insist that applicants have steady employment or receive income from another source, such as a pension or annuity. Applicants don't necessarily need to have high income levels. However, the higher the income, the better the chances are of being approved.

  2. Have a reasonable amount of debt

    As of 2014, lenders often look at the applicant's debt-to-income ratio. The maximum allowed is 36 percent for many lenders. New loans that put the ratio over 36 percent are usually not approved.

  3. Have a good credit score

    Having a good credit history boosts approval changes for loans. Some borrowers cite 580 as the minimum FICO score. A higher score allows access to lower interest rates.

  4. Have necessary documentation

    Most lenders require proof of income in the form of tax returns or copies of IRS Form W-2.

  5. Shop around

    Compare interest rates, fees, access to funds, availability of credit or debit cards linked to the line of credit and other benefits offered by different lenders.

  6. Complete and submit an application

    Submit the completed application to the lender and await a decision.

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