We assess a borrower's ability to repay a loan by analyzing their monthly income and expenses. We often calculate the debt service ratio, which compares the borrower's total monthly debt payments (including the new loan being requested) to their gross monthly income. A low debt service ratio indicates a stronger repayment capacity.

This ratio compares a borrower's total debts to their gross annual income. A lower debt-to-income ratio is generally preferable, as it indicates that the borrower is not overly burdened by debt relative to their income. We often set thresholds for this ratio, and a ratio below this threshold can increase the chances of loan approval.

We want to ensure that borrowers have a stable and reliable source of income to repay the loan. We review the borrower's employment stability, the length of their current employment, and the general trend of their income over time. Borrowers with a stable employment history and regular income are often considered less risky for lenders.

We often require detailed documentation to assess a loan application. This may include recent bank statements, proof of income such as pay slips or tax returns, statements of existing debts, and other relevant financial documents. Complete and accurate documentation is essential to assess loan eligibility and expedite the approval process.