A loan is an agreement between one party and another to exchange funds for a certain amount of time. The process of applying for an advance involves the borrower giving the lender a snapshot of his or her income, stability and reliability standings. Applicants need to provide prospective lenders with certain elements for loan consideration. Items that a person will need to apply for an advance include:
Pay and Income Stubs
Pay and income stubs are a vital part of the loan application process. Traditional lenders may request paystubs that prove several months or years of consistent income. They may also ask for tax documents and W-2 forms. Lenders review this information so they can make educated decisions about whether to place their trust in a debtor. Quick cash lenders such as payday lenders and title lenders are much more lenient than traditional lenders are. Such lenders may only require a debtor to provide his or her employer’s contact information.
A Credit Report
A credit report gives a potential lender an idea of a consumer’s willingness to repay an advance. Debtors do not usually have to submit their credit reports.
Instead, they provide potential lenders with their social security numbers, and the lenders check their credit profiles. A history of late and missed payments can have an adverse effect on the status of an application. Some lenders skip the credit check altogether. Lenient lenders include payday lenders, title lenders, installment lenders and pawnshops.
A person who is applying for a large loan such as a mortgage loan will have to submit a great deal of paperwork to apply for such a product. Asset documents include bank account statements, vehicle titles, stocks, bonds, pension plan documents, and more. The lender needs this information to see if it can recover its loan proceeds should the borrower default on the advance.
A Cash Deposit
A deposit or down payment may be an excellent item for a person to bring when he or she is applying for an advance. Deposits work well with auto loan applications and mortgage applications. Lenders have a greater sense of confidence about a deal when they know the debtors have invested a large amount of money.
Applicants will need to supply lenders with identification documents in some cases. Items such as social security cards, driver’s licenses, and birth certificates may be necessary to validate the loan.