In a perfect world, we all have the cash we need to buy all of the things we want. Unfortunately, that’s usually not the reality, but going into a bank and asking to speak with a loan officer can seem intimidating. We can help you prepare so that you feel confident! Check out this overview of what your lender is going to be looking for:
First
They are going to want proof of income. Your lender wants to see that you have a steady income and work history to give them confidence that you can pay back the money you borrowed. They also have to make sure you have enough money to pay your bills and your new loan payment, so they will calculate your debt-to-income.
Second
Your lender is going to verify your borrowing history by pulling your credit bureau report. Without getting too much into the weeds, your credit bureau report is essentially a report card on how well you make your payments to others you have borrowed from. Credit card companies, car dealerships, and even your phone bill can all be included in your credit bureau report, and positively or negatively impact your ability to borrow money. The better your borrowing history is, the more likely you will be to get approved for a loan.
Lastly
The lender is going to want to know what you plan to spend your borrowed money on or what collateral you plan on using to secure your loan. The term “collateral” is the bank jargon that they will use. In simple terms, we say collateral is “having skin in the game”. If you want to borrow $25,000 and you’re willing to put your car up for proof that you will pay the loan back, you will be more likely to get the loan you are looking for.
Those are the three main things a loan officer will look for when you ask about a loan
To get more information on terms, types, and the application process: