Better Homes and Gardens Rand Realty
Kenneth Rabasco, Better Homes and Gardens Rand RealtyPhone: (914) 844-2885
Email: [email protected]

What Lenders Look for When Approving Your Loan

by Kenneth Rabasco 10/27/2019

If you are looking to get a new loan, especially for a mortgage, a bank or your lending institution will review and approve or decline your application based on the information you provide.

That said, there is certain information that prospective lenders consider carefully when they examine your application for a home loan. This article is all about that data and the steps you can take to support your loan application as well as realize your dream of owning a house.

Here is the critical information your lender looks out for when reviewing your loan application.

1. Your Credit Score 

The number one place your lender will set their eyes on is your credit score no matter the channel you are coming from, either in person or online. This is a general rule of the thumb: if your credit score is high, you stand a better chance. Alternatively, if you have a low credit score, you will need to crack some hard nuts. So, you should give a critical look into your credit before taking the first step.

However, your credit score is just the first step. It could disqualify you immediately, but only a few banks will approve a new loan with a good credit score alone. If your bank disqualifies you based on your low credit score, do not panic as there are many other avenues to loan approval.

2. Your Payment History

If you pass step 1, now the real analysis begins. The first step after checking the credit score is to look at your complete credit history. Many banks have a system for underwriting loans using old school paper printouts. They would print your credit report for the loan file and would manually check it with a highlighter. They would select any late payments and mark them up to look for a pattern.

So, 90-day late payments are massive issues, although 30- or 60-day late payments may be pardonable. A pattern of late payments is enough to disqualify a loan application, even if you meet credit score requirements.

3. Your Ability to Repay Past Loans

When you pass steps 1 and 2, the banks will eventually shift their focus to your outstanding debt, income, and ability to repay the loan. By reviewing your complete credit report, they can determine if you have been responsible for past loans and possess the habits of making on-time payments. 

Final Thought

There are many erroneous beliefs out there about how mortgage loans are approved. You need to show both that you have the income to support the loan and a history of responsible and on-time payments. Lacking one or the other can stop your mortgage application right in its tracks.

About the Author
Author

Kenneth Rabasco

Professional Associations & Designations Ken Rabasco aka Bosco is a member of the National Association of Realtors, the New York State Association of Realtors, Hudson Gateway Association of Realtors, and the Hudson Gateway Multiple Listing Service. As a lifelong Westchester resident, Bosco has a vast and extensive knowledge of the intricate details that comprise the communities of Southern Westchester, be it a recommendation for the best place to have dinner in one of the many River Town restaurants, or a market forecast for what the future will hold for the next place you'll call home. With a laser-attentiveness to detail and a never-faltering determination to get the job done, Bosco is supremely dedicated to his clients, and promises the very best in service to those who work with him, whether a first-time buyer or a long-time veteran of the market. Real Estate Expertise Licensed Real Estate Salesperson with Better Homes & Gardens – Rand Realty. Bosco specializes in listing and selling of co-ops, condos and houses in Southern Westchester covering Hartsdale, Ardsley, Scarsdale, Eastchester, Tuckahoe, White Plains, as well as the River Towns and those that are on the Long Island Sound. As a licensed real estate salesperson for Better Homes & Gardens – Rand Realty in White Plains, I have developed a dedication to client service and satisfaction that is unsurpassed. I am up-to-date on all the real estate market trends. With a professional, yet friendly approach, I help my clients feel comfortable when buying or selling their next home. Professional Associations & Designations Hudson Gateway Multiple Listing Service Subscriber, Hudson Gateway Association of Realtors Member, New York State Association of Realtors Member, National Association of Realtors Member Community Involvement Member of the Rotary Club of Hartsdale - Greenburgh Education Pace University - Bachelor of Business Administration Testimonials I will never refer to Bosco as my realtor, he’s a trusted friend. I met Bosco 6 months after loosing my husband of 11 years. I have two daughter’s Jennifer and Kylie. I didn’t need this big house in Eastchester. The upkeep was just too much for me. Bosco helped me sell my home and I purchased a townhouse. It was important for me to keep my girls in the Eastchester school district. I will be forever grateful to my new friend. He still calls from time to time to check in on us. Thanks Bosco. Karen Schwartz You will not be disappointed with all the work that Ken aka Bosco does for his clients. I was able to sell my house very quickly with his knowledge of what sells a house. From the front door throughout the house he noted what had to be removed and changed. He understands what people want to see in purchasing a house. With his help I was able to sell my house for $15,000 over the asking price. You won't go wrong with Bosco looking out for you. I can't thank him enough. I learned a lot from him, he knows the business. I will be forever grateful. Helen Izzo My girlfriend and I were looking to relocate to Westchester. We were first-time homebuyers and Bosco helped us with every step of the process and helped us find our dream home. He made sure to understand what we wanted. He made himself available when we had questions. He is reliable, very knowledgeable, and a true professional. Debora Flores I had the great pleasure of working with Bosco this past winter-spring on my first home purchase. Prior to Bosco I had a bad experience with another realtor who was unfortunately very unresponsive, lacked effort and ultimately not helpful. Thankfully my wishes were answered when I met Bosco because he was the complete opposite. Bosco doesn't waste time, he's extremely on top of everything. When I expressed interest in a listing, he'd book a visit within 1-2 days of me highlighting my home. He understands how aggressive the Westchester market is; good homes were snatched quickly. Moreover, I work in Manhattan, so I could only see places late at night, 7:30pm onward. He didn't mind visiting listing with me late a night. He worked around my schedule, not his. Being a first-time buyer, I had no experience with all the complexities of co-ops. It was great working with Bosco because he knows so much. He sits on a co-op board himself, so he has first-hand knowledge of what co-op communities are looking for. He successfully guided me on all the paperwork I need to paint myself in the best light to have my offer accepted and achieve board approval. Bosco's super passionate about home buying and I think that's the type of realtor you need to successfully land a great home. His combined passion and experience makes him a great realtor in my opinion. He's my realtor for life now, because I know he'll provide the best service. Ben DiChiara Bosco is everything you would ever want in a real estate agent. Smart, personable, energetic, friendly, tireless in his pursuit, of your goal. He is dependable, reliable, and at your beck and call. What more could you want. I would use him again anytime and refer him to anyone. If I could give him more than 5 stars I would. Cecilia Cohen-Downes