Credit Analysis: Know What’s Taken Into Consideration – Low Interest

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Anyone looking for a financial institution to apply for a loan or a financing knows: waiting for the result of the credit analysis is the time of greatest anxiety and tension throughout this process.

Knowing a little more about how credit analysis works helps to contain some of this anxiety and can even contribute to increase the chances of approval of the proposal.

Each financial institution adopts its own evaluation parameters, but the essence of the process is basically the same in all of them. Let us now know the main steps of a typical credit analysis process.

The cadastral analysis

 The cadastral analysis

The first step a financial institution makes is to gather the personal information of the applicant, always on the basis of supporting documents. What the institution expects to find in this step is trustworthiness, that is, knowing that the applicant is really who he or she claims to be, who has a fixed address, a source of income, telephone and e-mail for contact, etc.

The data that the applicant must present and prove include:

  • their identification (basically, the data that appear in the RG and in the CPF);
  • proof of residence;
  • proof of income;
  • means of contact (residential, commercial, cellular, email);
  • personal and professional references (name and phone number);
  • possibly, documents proving their marital status, their dependents, their level of education, property ownership, etc.

In obtaining this data, the institution undertakes to keep them confidential.

The analysis of constraints

 The analysis of constraints

This step is well known. The institution verifies that the CPF of the applicant is included in credit restriction registers such as Serasa, SCPC, the institution itself and others.

The result of this search puts the requester in one of the following situations:

  • No restrictions: when there is no negative record;
  • With alerts: when there are old records already closed; In this case, credit approval is not normally denied immediately, but the institution adopts a greater rigor in the other analyzes;
  • With restrictions: when the applicant has pending credit with other institutions, such as delays, renegotiations, defaults, protests, inclusion in the registry of issuers of checks without background, search and seizure actions and others;
  • With impediments: when the applicant is prevented from taking credit due to blocking of assets, impediments of the Housing Finance System or other legal determinations.

The analysis of the credit profile (score)

 The analysis of the credit profile (score)

Together, the cadastral data and the survey of replies provide several indicators, each with its degree of importance, to the definition of the credit profile of the applicant.

Each indicator receives an evaluation. In the end, the composition of all of them leads to a score given to the applicant, which reflects the institution’s view of the likelihood of the commitment being withdrawn.

Cadastral indicators

Some indicators are evaluated according to the categories in which the applicant fits.

For example, imagine that the applicant belongs to a certain age group. If creditors of the same age group have a good track record in relation to the discharge of the loans contracted, the applicant will receive a note compatible with this good reputation. Of course if the reputation is not good he will receive a corresponding note.

The age range is just one example, several other items can be considered, such as the income range, the region in which you reside, your marital status, the professional category to which you belong, and so on.

Historical Indicators

Other indicators relate to the applicant’s financial life. They are given as:

  • the number of times the applicant sought credit in the market;
  • how many of these searches were in banks and how many were in financials;
  • value of outstanding debts;
  • existence of credit restrictions or lawsuits against the applicant;
  • etc.

The analysis of income impairment

 The analysis of income impairment

In this stage, the applicant’s ability to pay is analyzed. Proof of income is the main source of information. The concern of the institution is to ensure that the installments for the discharge of the loan will fit within the budget of the applicant. In general, it is considered reasonable that the amount of the monthly installment for the discharge of the debt does not exceed 20 or 30 percent of the income, but this may vary from one institution to another.

The institution will take extra care with applicants who have no fixed income in the month. In these cases, it can analyze longer periods and more detailed data, arriving at a kind of balance sheet of the applicant.

The equity analysis

The equity analysis

In certain credit modalities, assets may be offered as collateral, which may result in reduced risks to the institution and lower interest rates for the applicant. But the institution needs to first evaluate these assets to make sure they are in good standing and also to determine what their real value is in the negotiation.

Concluding: credit is synonymous with credibility

 Concluding: credit is synonymous with credibility

In addition to all these analyzes, the economic situation may influence the decision regarding the granting of credit or not. More favorable scenarios, with the heated economy, tend to facilitate credit taking. The opposite occurs for moments of market stagnation or retraction.

Another important point is that, as stated earlier, although the analysis steps presented above are common to all financial institutions, each one adopts its own evaluation parameters. Thus, for example, what for one institution may represent a decision to deny credit to the applicant, for another it may mean approval with a higher rate.

On the applicant’s side, knowing a little more about the principles that guide the credit analysis can and should lead you to surround yourself with some care such as avoiding the negative of your CPF, keeping up-to-date and clear vouchers, maintaining a good relationship with financial institutions, control their finances and demonstrate a good ability to pay, for example.

It is easy to remember that credit is synonymous with credibility. The credit analysis is essentially an analysis of the credibility that the applicant passes to the institution in terms of financial behavior.

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The Best Loans for Cars

Car loans were created by banks, as the name implies, to finance the purchase of a car exclusively, although this type of loans in some cases are granted to finance other types of vehicles, such as a motorcycle.

Like any personal loan, when you are going to request a loan to buy your car, you must take into account that the bank or financial entity is going to analyze your economic situation , to know if you are a reliable client or not.

In the market we will find different financial offers and we will also realize that the best offers are found through the internet, because in this way the entity saves money in expenses. It should be noted that if you are already a client of an entity and you have your salary registered with them, you can access the best conditions in terms of interest.

Below, some of the best car loans out there in terms of conditions and interest rates.

 

Collection of loans

Collection of loans

There are many personal loans in the market that are used to finance the purchase of a vehicle and also offer affordable interest rates, although many of these are associated with the contracting of several products that may be mandatory or not. We must be aware of the different types of loans and their attached products and interests.

Caja Granada has a loan in the market called Auto Bonded Loan, it requires the purchase of car insurance with a Euribor interest rate of plus 2%. We can request this loan for our vehicle through the internet or by approaching the branches that this entity has and request financing. With the Caja Granada we will have a maximum financing of 36,000 euros that we can pay in agreed and negotiable installments.

Bilbao Bizcaia Kutxa offers a loan for our future car with an interest rate of 5, 89% and does not require the hiring of any additional associated product. It offers us a maximum financing of 60,000 euros and we can request it at the company’s branches. This entity allows us to postpone the payment of 25% of capital in our last installment with which, we can afford the value of the sale of the vehicle with a very affordable monthly fee. For example, for an amount of 10,000 euros for a term of 5 years, the monthly fee for this loan would be 193 euros.

A website that offers the market several loans, one of them is only for financing our choche and we can apply to the name of Auto Loan for an interest rate of 6.9% in the first year and the rest of Euribor with more 4.9%. This financial blog offers us a maximum financing of 50,000 euros with a minimum opening cost of 100 euros and requires the direct debit of our payroll, two receipts and the payment protection insurance contract.
As far as we can perceive, the offer of loans to buy a vehicle is extremely varied and wide so we must be aware of all the offers of the market and then decide on the one that suits us best.

If we realize, the offer in terms of credits to buy a car is quite broad and from here we recommend our readers, not to be carried away by the first offer they receive.

Make the decision to buy your car with a money that you give is not silly, because for a few years you will be with a responsibility to the entity that grants it, so it is important that you review certain issues well. Not only guide you by the interest rate, but also by the different conditions offered by each entity .

At the same time, it will be necessary to see what requirements you request in each of them, in order to analyze our particular situation.

Do You Have Problems Paying Your Mortgage?

 

If you do not pay your mortgage on date or if you pay less than your monthly payment, you default on your loan. The consequences of non-payment can be expensive.

The Federal Trade Commission (FTC), the national consumer protection agency, says it is important to understand the costs of non-payment. The agency also points out that if you are having trouble paying your mortgage, contact your loan administrator as soon as possible to discuss your options. The longer it takes to call, the fewer options you will have.

What happens if I fail to pay my mortgage?

What happens if I fail to pay my mortgage?

Failure to pay your mortgage can add the cost of several charges to the amount you already owe. It can also hurt your credit score. And in the end, it can cause you to lose your home.

Charges for late payment. If you are late in paying, you may be subject to an additional late payment fee. Late fees can add hundreds of dollars to your mortgage account.

Charges related to non-payment. The administrator of your mortgage is the company that manages the account of your mortgage loan. If you default and default, your mortgage servicer may charge you for “services related to non-payment” that, over time, can add hundreds or even thousands of dollars to your loan.

Services related to non-payment can include:

  • Property inspection to make sure that you are living in the house and to control that you are maintaining it.
  • Preservation of property , which includes the costs of services such as mowing, gardening and repair, or the cost of covering broken windows or doors with boards.
  • Foreclosure costs , which may include attorneys’ fees, charges for finding title deeds, and costs of postal mailings and publication of foreclosure notices.

Damage to your credit score. Mortgage managers provide information about your payment history to the credit reporting companies, which includes reporting if you were behind with a fee or omitting any payment. Even a single payment delay decreases your credit score, which in turn affects your ability to obtain a loan in the future – and the interest rate that will apply.

Foreclosure If you incurred default, your mortgage servicer can initiate the foreclosure process. This will not only add expenses to the costs that you will have to pay to get up to date with your loan account, but also, the foreclosure procedure is a matter of public record. As a result, it will be harder for you to obtain credit in the future to buy another home. If you are unable to catch up on your loan or if you can not find some other solution, your house could be sold at a foreclosure auction. In several states, you will also be required to pay the ” deficiency judgment” , whose amount is made up of the difference between what you owe and the price you get for the house at the auction. of sale of the foreclosure process.

What should I do?

What should I do?

Be very attentive to your mortgage loan account. Check your account regularly to check that your payments are credited on date and to make sure you are not charged any unexpected or unusual cost or charge. If you do not receive monthly account summaries, ask your administrator if you can access your online loan account. Be active and question everything you do not understand and keep records of all communications with your mortgage servicer. Among the things you have to monitor are the following:

  • Accreditation of payments. Keep a record of the amount and date of your payments. If you made a full payment, the administrator must credit your loan account the same day you receive it. If you make a partial payment, the administrator of your loan is not obliged to credit your account and can return the payment and place your account in “suspended” or “pending” status: which means that the payment is in limbo until you provide the funds to complete the total amount of the fee.
  • Additional charges for late payment incorrectly applied. Most mortgage loan agreements include a “grace period” – which is the time you have to pay without incurring the application of a late payment fee. If you pay within the grace period, you should not be charged any late fees. The payment date is the day in which your administrator receives the payment and not the day you send it.
  • Multiplication of charges for late payment . Only a late payment fee should apply if you do not pay the full amount of your mortgage monthly. Some mortgage servicers have applied late fees for full monthly installments paid on the date because the borrower did not include the amount of a late payment fee that had been left unpaid. This practice is known in English as late charge “pyramiding” , something like a mountain of charges for late payment, and is a practice contrary to the law.
  • Charges for services related to non-payment. Check your account to check if you have been charged for services related to non-payment. Be sure you understand what they are for and why you were charged those charges. If your account summary shows mysterious charges registered as “other charges” or “corporate advances”, contact your loan administrator to explain them to you.
  • Escrow account. If you have a escrow account, better known as an escrow account, which is linked to your loan and whose funds are used to pay real estate taxes and the owner’s insurance premium, review the annual summary of your escrow account. Check that the amount of the taxes and the insurance premium listed in the summary is correct and that the taxes and insurance have been paid by date. If you have an escrow account, the amount of your monthly payments will increase if the value of the taxes or the insurance premium increases. In case the escrow account has few funds, adjust the amount of your monthly payments to cover those payments.
  • Mortgage management services during the bankruptcy repayment plan. To stop a foreclosure, some borrowers choose to declare bankruptcy under Chapter 13. When a person files for bankruptcy under the provisions of Chapter 13, the court generally approves a repayment plan that allows you to pay off your debts within a period of time. between three and five years. The bankruptcy payment plan may include the amount of the unpaid and unpaid installments of your mortgage, but it does not affect your obligation to pay the current mortgage payments. You must continue to pay the monthly installments in full and on the date otherwise you may incur non-payment. In that case, you may be charged late fees and charges related to non-payment, and your mortgage servicer may ask the court for an authorization to run your home.

It is important that you continue to monitor your mortgage account, even during bankruptcy. Make sure that you are credited with the amount and date of payments correctly. Check that there are no charges or incorrect costs for late payment and closely monitor your escrow account.

Where can I go for help?

Where can I go for help?

If you are struggling to make your payments or if you have already fallen behind or default, contact your mortgage servicer immediately. There are many people who are embarrassed to talk to their mortgage servicers about their payment problems, or who hope their financial situation improves in order to catch up with their payments. It is important to keep communication channels open to solve problems that may arise with your loan. Options to help you get up to date with your home loan and save your home from foreclosure include loan modifications, repayment plans, or a temporary reduction or suspension of payments. If you are not eligible to access any of these options, your mortgage servicer may be able to help you find a solution that is better than a foreclosure, such as a short sale , or a voluntary transfer of the property through a “deed in lieu of foreclosure”.

In addition, by keeping in touch with your mortgage servicer, you can save money, and thus, you can get up to speed with your mortgage loan more easily. For example, although mortgage managers have different policies regarding the time required to require services related to non-payment, some may not require you to inspect the property or require preservation work if you inform them of all the months that continues living in the house and that is in charge of its maintenance. And they are also likely to delay the sale of the property at auction or foreclosure if they are working with you to find a better solution.

 

Borrow Money for Car Purchase with Car Loan

Next to mortgages is money to buy one of the most common loans from Swedish households. A car loan is signed with the car as collateral and is only given if you buy a new or used car from an authorized car dealer.

Since the car is the security of the loan, you must make sure to repay at a rate that corresponds to at least the car’s depreciation. There are therefore no amortization-free car loans.

 

Cash contribution 20% at car loan

Cash contribution 20% at car loan

When you buy a car and borrow money for the purchase, you must add at least 20% in cash. It is regulated in the Consumer Credit Act (SFS 2010: 1846). The insert may consist of an exchange of an old car with the equivalent of 20% in value. You can borrow up to 80% of the purchase price for your new car.

If you are going to borrow money for the car via a bank, they usually always want you to buy the car through an authorized dealer of cars. For the bank’s account, this is important because they want to ensure that the car is carefully checked and that the valuation is really done.

 

Full insurance as a requirement from the bank

Full insurance as a requirement from the bank

The bank wants to ensure that the value of the car is kept as constant as possible. It may therefore occur that the lender demands that you must fully insure your car and that the insurance runs at least as long as the car loan.

 

Today, banks are not only lenders but also insurance companies. This means that they can be extra demanding about full insurance, but you can also use this to push out different banks against each other. Look at the overall cost and the protection you receive and take in various suggestions from different banks.

 

No loans for the purchase of older cars

No loans for the purchase of older cars

If you are buying a used car it may be worth knowing that almost no lender grants loans for the purchase of cars older than 9 years. The car must also be Swedish sold and you who borrow must be more than 18 years of age, have a fixed income and no payment remarks. However, there are exceptions to lenders who actually grant loans, but to much harder loan terms than other car lenders.

 

Private loan for the purchase of a car

Private loan for the purchase of a car

If you are going to buy an older car you can of course instead take a private loan / blank loan without security, because the bank then does not care about what you should have the money for. Then of course you can also borrow money to buy the car privately without going through an authorized car dealer.

 

Car loan with payment note

Having a payment note can put a spanner in the wheel, an expression that becomes extra clear in this context. Having a payment note does not, however, have to mean that the payment ability is poor and that you have problems paying bills and loans.

For those who have a note in the baggage, there are lenders who can accept applications for loans anyway. We have found several lenders you can turn to. The loans they give are not dedicated car loans, but private loans you can take and use for what you want.

 

Payday loan up to 50,000 – About interest, requirements, etc.

Payday loan is a new option you have gained in the online market. At the beginning of May 2016, is expected to live in Denmark, with the possibility of applying for payday loans up to DKK 50,000.

It is money that can finance most things and the best thing is that you can search for it without security and without having to ask a lot of questions. You can use the money you prefer.

See more about the new Payday loan loan, its interest rate, requirements for applicants, etc.

Payday loan loan up to SEK 50,000

With it you can apply up to DKK 50,000 and they ask no questions about what the money should be used for. It gives you the total freedom and flexibility to decide for yourself whether to be a new computer, a foreign trip or home renovations.

The easy and fast application process is at the forefront of the new Danish company. This means that you can search quickly, get answers within 1 hour and get the money paid the same day that you are approved. If it does and that is in everyday life.

In summary, you can expect the following:

  • Answer within 1 hour
  • Quick payout
  • it is a payday loan without security

it interest rates, requirements etc.

In this section we look at it’s interest rates and requirements for applicants. The interest rate starts from 8.73 percent, making them an affordable addition to your consumer choice.

There are only a few cheaper companies, so we can clearly recommend you get quotes from them. You can always do so without obligation. It is worth noting the following:

  • RKI not allowed
  • Can document my income
  • At least 20 years old

Their requirements for you as a customer are very normal for the online market in general. Nothing new under the sun there. You must be glad they do not require you to have a minimum income. All you have to do is document your income.

If you then get approved and what interest you will be offered, then you will depend on your income and personal finances in general. We hope you have a good insight into Denmark’s new player in the online loan market.

New providers are always helping to strengthen competition, which usually contributes to lower interest rates, better conditions and more benefits to you as a consumer. The trends of recent years, with several new businesses in the online market, are therefore a very positive trend. It is no coincidence that you have never been able to obtain as low interest rates as you can in 2016.

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