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The Credit Application “Oh what a tangled credit web we weave,
when first we practice credit deceit.”
The first step in borrowing money is filling out a credit application (sample credit application). The bank scores out the application, and the point total of the score determines the column of finance. This column dictates all the conditions of the loan. What’s important to the score is the applicant’s time in area, time on job, and the money coming in and out of the household.
Here are the rules that must be followed when filling out a credit application:
- DO NOT EVER SIGN BLANK APPLICATIONS
Blank applications allow the dealer to use your credit against you. The dealer can fill in the blanks to build outrageous profits.
- FILL OUT THE APPLICATION COMPLETELY AND HONESTLY
False or misleading information will come back to bite you. You must be able to prove everything you write down on the application.
- KNOW YOUR TRUE SALARY
The bank calculates what you can afford based on your monthly income. If you’re on salary, divide your yearly income by twelve. If you’re not on salary, be sure to calculate income based on a 52-week year rather than a four-week month. To understand why, consider the following example. If you make $20 per hour and work 40 hours a week, and you multiply that by four weeks in a month, you make $3,200 a month in income. If you multiply your weekly income by 52 weeks in a year ($20,800), however, and divide by twelve months, you make $3,466 in monthly income. Don’t cut yourself short. $266 a month is a car payment!
To learn more, read...
Kick the Dealer...Not the Tires!
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