Lenders have a specific credit policy they use to assess and approve loan applications.
A lender’s credit policy is a document that outlines the requirements and procedures for approving a loan and normally considers the following factors:
Borrower criteria Residency status Guarantors
Savings requirements – both genuine and non-genuine Employment and income
Expenses and liabilities Property and security Loan to valuation ratio
Lenders mortgage insurance Maximum loan amounts
Loan purpose; and Interest-only loans
Every lender has a different credit policy and the different documents a lender will ask for is set out in the lender’s credit policy. If your situation falls outside of the lender’s policy, it is likely that the application may be declined.
A lender’s approval or denial decision and the criteria they base their decision upon may vary significantly from one lender to another, which explains why a loan application may be approved by some lenders but not others.
As your mortgage broker is accredited with a range of lenders, they are required to have knowledge of lender credit policies. Having this knowledge and access to a range of lenders gives your mortgage broker the ability to ensure they provide you with the outcome that meets your requirements and objectives.
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