The home loan market in Australia turns over $1,000B/yr and it is important to understand that while a bank does care about it's customers, you are not much more than forms in a folder or files on a computer screen. They often don't have the time to talk to you at length and get to know you, what type of a person you are or your circumstances; all they have is the information and paperwork you have provided. This, along with the speed with which most applications need to be assessed means the lender often doesn't have the ability to consider much apart from the applicant meeting a set of standardised criteria.
That's where having Runmore Loans be your representative helps. We want to know as much about you as possible so we can make sure you get the loan that suits you now and into the future.
The 5 C's
Many lenders use computerised credit scoring for qualifying an applicant. Credit scoring looks at your credit history and converts it into a score which represents your credibility as an applicant. If you score poorly, the application can be declined, regardless of other strengths.
Therefore, it’s important to remember the five C’s of credit:
- Character (Integrity, the general impression you make on a lender)
- Capacity (cashflow to service the loan)
- Capital (net worth)
- Collateral (assets to secure the debt)
- Conditions (of the borrower and the overall economy)
Credit scoring is a large part of the first C, Character. Runmore Loans can help by providing you tips and strategies you can use to improve your credit score and character. For every buyer, and especially if you're a first home buyer, getting the right advice early can be the difference.
Capacity is a reference to your ability to service the loan. We know how to maximise your serviceability and improve your chances of getting that approval. Capital and Collateral relate to what financial assets you have and what the bank uses to secure the lending against.
Runmore Loans can help you prepare your application so that you can best your best foot forward when we submit your application.