Thinking about a personal loan, mortgage, or business finance? The first thing you’ll hit is the lender’s checklist. Knowing that list inside out saves time and avoids nasty surprises.
Every lender—whether a big bank, a credit union, or an online lender—looks for the same core facts. They want to be sure you can repay the money without putting their business at risk. Below we break down the main items they examine and give you quick steps to make each one work in your favor.
Your credit score is the number that pops up first on most lenders’ radar. A score above 700 usually opens the door to the best rates, while anything below 600 can mean higher interest or a flat rejection.
What you can do now:
Even if your score isn’t perfect, showing a recent upward trend can impress lenders. They often look at the full five‑year history, not just the current number.
DTI measures how much of your monthly income goes toward debt payments. Most lenders cap this at 36 percent for conventional loans, though some high‑risk products stretch up to 45 percent.
How to improve it:
Showing a lower DTI tells lenders you have breathing room to handle a new payment.
Other Must‑Have Documents
Besides credit and DTI, lenders want proof that you actually earn the income you claim. Typical documents include:
For mortgages, you’ll also need a proof of address, a valid ID, and sometimes a detailed breakdown of your monthly outgoings.
Getting these together beforehand cuts the back‑and‑forth with the lender and speeds up approval.
Why Lender Requirements Vary
Not all lenders apply the same strictness. Online lenders often accept a lower credit score but charge higher rates. Credit unions may be more forgiving on DTI if you have a solid relationship with them. Shopping around gives you leverage—one lender’s “no” could be another’s “yes.”
Before you submit an application, use a free loan calculator to see what monthly payment looks like at different interest rates. If the number feels tight, either raise your down payment or look for a loan with a longer term.
In short, the secret to a smooth loan approval is preparation. Check your credit, lower your DTI, gather clear proof of income, and compare a few lenders. When you walk into a meeting with those boxes ticked, the lender’s job becomes easy—and so does getting the money you need.
Wondering how low your credit score can go and still get a loan? Find out real lender cut-offs, tips to boost approval chances, and key credit facts.
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