Bank required loan application.
Anyone who builds or makes purchases often takes out a loan. To get this, a loan application is required. It shows all the facts about the loan applied for, the person and the property. The loan application is, so to speak, the road map for credit approval. The necessary data is shown here.
Lenders, especially banks, want to know who they are dealing with. This is not only in your own interest, it is also required by law. Borrowers must legitimize themselves by presenting an ID, usually an identity card. Important personal data are the surname and first name, the address, marital status and the number of children. In addition to this purely personal data, the lenders are interested in the professional environment of the borrowers. Information on the profession carried out, the employer and the employment relationship are particularly important.
Lenders gain insights into the professional future. Long employment with a company suggests that secure employment will also be guaranteed in the future. In addition to the professional situation of the person, the creditworthiness situation is particularly important. The income and expenses are shown here. The income consists mainly of net income and capital income. There may also be additional rental income or other income. The expenses consist mainly of living expenses, insurance contributions, rent or credit installments as well as other expenses.
They show the banks what free amount of income the borrower has. The repayment rate must be based on this. When it comes to spending, it is important to know which installments are to be paid from existing loans. The amount of the existing loans is also crucial for assessing the applicant’s creditworthiness.
This part of the loan application shows the relevant data for the loan. In addition to the loan amount requested, the loan interest, nominal and effective, the fixed interest period and the monthly repayment rate are shown. The level of the interest rate depends on the interest on the capital market and the risk assessment by the banks. The monthly repayment rate must allow adequate repayment of the loan. Another aspect for the loan is collateral. To minimize the risk of default, banks attach great importance to obtaining collateral.
If the applicant buys or builds a house or apartment, this property serves as security. A land charge or mortgage is entered in the land register. In addition to property security, valuables such as cars can also serve as security. In many cases, existing assets from insurance and building society contracts are also assigned to the banks as security. The more security, the lower the risk of default.
If the loan is used to buy or build a property, the object is shown in the loan application. There is a description of the residential area and a description of the property. In the residential area, the banks are particularly interested in how attractive the situation is and will be in the future. The description of the property serves to assess the intrinsic value of the property. Are the costs within the normal range or is the property associated with high additional costs. It is always about what value the object will achieve in a sale. Only this value is relevant for banks.