In order to obtain the credits in the form of loan there are four main criteria steps involved they are capital, capacity, character as well as collateral. The first three steps are related to the borrowers, whereas the final step is related to the evaluation of the property.
The capital is referred to as the aspect which is related to know whether the applicant is having the essential standards of paying the loan amount in time or not.
The capacity is referred to as the aspect which is related to analyze whether the application is capable of repaying the loan amount.
The capacity refers to analyze the capability of the individual in repaying his loan amount, whereas the character refers to analyze the past history of the individual in paying his previous loan credits.
The collateral process is one of the significant aspects in getting the loan amount. The valuation of the capital, the capacity as well as the character is particular and related to the borrower. The collateral aspect is referred to as the process of analyzing the properties and guarantees of the applicant opting for the loan.
The requirements and qualification in order to obtain the loan from a bank differs from bank to bank and the type of loan. As there are different types of loans such as personal loans, home loans, mortgage loans, educational loans, car loans, business loans and many more. As the loans vary in their nature, the qualifications required to obtain them will even vary. There are general requirements to obtain the loans such as the individual profile of the applicant, documents related to the type of loans, the collateral properties documents, previous transactions within any type of bank, previous loans status etc.