Applying for a loan is a process filled with factors; Understanding how much you qualify to borrow, relative to how much you want to borrow is an important consideration to make. The loan experts at Canadalend can help you make the most informed decisions when you are ready to apply for a loan. A Canadalend loan criteria assessment is an important step in the process, and here are just some of the factors to consider during a loan criteria assessment:
How is your credit?
A major component of a Canadalend loan criteria assessment is a strong credit score. To qualify for credit, your credit report and score must meet the standards of your lender. Most lenders have minimum credit scores that must be reached for consideration. If you have always paid your bills on time, you may not have anything to worry about. If you do have a history of slow payments, you may be considered a higher risk by a lender. Thankfully, Canadalend has access to a large pool of loan providers or lenders who provide a variety of products for higher-risk clients.
Do you have a steady job?
You will need to have a constant source of income to apply for credit of any kind. If you do not have a steady paycheque, a lender cannot be sure that you will make your payments each month — it is a risk factor that many lenders won’t accept. Many lenders require two years of consistent employment before approving a loan of any kind, emphasizing the importance of employment. Lenders want assurance that you are able to hold down a job long enough to pay back the money they lend.
Can you make the monthly payments?
A lender can calculate if you are able to afford a loan payment by looking at your income-to-debt ratio. During your loan criteria assessment, the calculation of your monthly housing costs should not be more than 32 percent of your gross monthly income. Housing costs include: your monthly mortgage payment, property taxes and heating expenses. If your monthly payments exceed these levels, you may not qualify for further credit. A Canadalend mortgage and credit specialist can review your situation with you to see how much credit you qualify for based on your income.
Do you have the collateral for a loan?
Collateral is something you own that you can pledge as security for a loan, and is an important part of taking on a loan of larger sizes. Lenders want to ensure that they can recoup their loss if you are unable to pay back your loan. A mortgage needs a house, a home equity loan needs a property and a debt consolidation loan typically requires some form of security. If you do not have security for a loan, you may need someone to co-sign.
A Canadalend loan criteria assessment is the first step to determine if you qualify for the credit you are requesting. Although Canadian lenders conform to standards set by Canadian government agencies, loan approval guidelines vary depending on the terms for each specific kind of loan. The experts at Canadalend utilize years of experience and a wide range of strong relationships with experts in the financial industry to secure loans for clients in Toronto, Brampton, Mississauga and other Canadian cities.