Topic 11 - Checking the applicants credit status Flashcards
1
Q
Credit assessment
A
Looking at bank statements
- Balance regular income/Out
- Overdrafts and fees
- failed Direct debits
- Maintenance/mortgage payments
2
Q
Not on statements/references
A
- Pending court hearing
- Action for child support
- Borrowings to be drawn
- Cash not in bank
3
Q
Guarantee
A
A formal agreement to accept legal responsibility for the repayment of a loan if the borrower cannot, or will not repay it themselves
4
Q
Guarantor
A
An individual, a company or a partnership that provides a guarantee. Also known as surety
5
Q
Full Liability Mortgage guarantee
A
- Guarantor is liable for entire debt if borrower defaults
- Guarantor has to demonstrate they can afford to pay 100%
6
Q
Limited Liability Mortgage guarantee
A
- Liability is limited to the difference between normal and what is needed
- Guarantee is around 10% additional
7
Q
IVA
A
reduces payments
60p for £1 owed
8
Q
DrO
A
Owe maximum of £20,000
Assets less than £1,000
Disposable income less than £50
