Banks
are getting tougher and more stringent when it comes to providing loans and credit
to consumers these days. The change that one sees in the financial circles is
due to the loss that the firms are incurring due to bad debts. Though banks and
financial institutions have been notorious about preferring consumers who cannot
always pay the entire credit payments, the fact is that it is from among these
consumers that insolvent situation arises. And
that is the reason why banks screen loan or credit applications and the information
provided in the credit application or 1003 (term for application in mortgage business).
Therefore, it is extremely important to understand the entire process and try
so that you can fill up the application in a manner that will ensure your credit.
There are two factors that really determine your chances of getting a car
loan, mortgage or even a credit card. These are:
1.
The content of the application and the information you provide about your jobs,
house history and more
2. Your credit history, the
credit score and other specific factors that go into determining your score.
A good credit score and a good credit history is obviously a very important
factor. However, there are many applicants who get rejected regardless of a good
credit history. This is because you can actually have a good credit history that
does not result in a good credit score. For example, if you have a few credit
cards with maxed credit limits or an open mortgage that you have been servicing
for the last few years, you can still have a credit score between 670 and 690.
In some cases people with 4 to 6 credit cards and only two or three years in credit
report with a score of 720 or higher. It is therefore obvious that a good credit
history is a necessary but not sufficient condition for a good
credit score. You can learn more about this in another article on our website.
The other aspect that can determine the fate of your credit application is
the form itself. For simplicity, let's talk about auto loan and credit cards applications
in particular. When you sit down to fill the application form, make sure that
you have your driver's license and your current pay stub handy. You will need
this information to fill up the form. Let's take each of the various heads that
you are likely to see in the form and understand how you should handle it. 1.
Name - Ensure that the name that you write in the application form exactly
as it appears in your license. Make sure that you mention the specific 'Sr., Jr.,
I, II or III' that is attached to your name. Follow the guidelines when it comes
to the order in which the first, middle and last name have been asked for. Put
each in the correct order and place.
2. Address
- Obviously, you need to enter your current residential address. However, if you
have not been staying in your current residence for the past two years or more
then provide your previous address. All the information that you provide must
be exact - the zip codes, apartment number street number and other information.
If you live with a roommate, you need to be careful since you are likely to be
visited by a loan officer asking for some proof of residence (VOR) under your
name. This is almost always asked for in the case of a home mortgage application.
3.
County - Make sure that you understand whether you are being asked for your
country of birth or county of current residence before filling up the details. Next
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