We had one of our strategic alliances Mark Cleland from Mortgage Choice write an article regarding the “3Cs for getting loan”. If you wish to find out more about him, please contact him here.
When evaluating the application of an Individual, Banks will use the 3 C’s of credit analysis:
The banker will make a judgement about you, your experience and commitment to repaying the loan. They will access your credit file to view your history of late and on-time payments. The Bank will consider your education, experience and past stability of Employment and Residence. This assessment is subjective whilst the next two are objective.
The Bank will pass your current levels of income and your liabilities through their “Assessment” tool to determine if you have the Capacity to repay the proposed new borrowing. To reduce yours, and their risk they have buffers in the tool to ensure that if rates were to increase during the life of the loan; that you can still meet the new repayments.
If you tick the above three areas Banks will want to give you a loan offer. Rates are also adjusted for the strength of your application. The stronger you score in the assessment process the lower the rate that you will be offered.
There are a lot of options in the market and the market is very competitive. A Finance Broker is a professional who will get you the best offer available.
This article is for general information purposes only. It has been prepared without considering your objectives, financial situation or needs. You should, before acting on the advice, consider its appropriateness to your circumstances.