Getting a bank loan: what are the criteria?

You need a bank loan for your project, but you don't know the eligibility requirements. Banks require a certain number of criteria to give a loan agreement. However, they have set up a system that allows them to carry out what is known as a "risk-client analysis". The conditions of acceptance vary from one bank to another. Discover in this article, the recurring criteria.

You must be financially stable and have less debt

Before a bank grants you a loan, it must make sure that you are financially stable; you have an income that is regular and fixed. This condition is essential for these institutions. To gain their trust, make sure you have a reliable and stable source of income. If you are in the public service and work on a permanent contract, banks will easily give you a loan. So having a job is an excellent asset. To find out what you need to borrow money from a bank, read here. Your debt ratio is the ratio of your total monthly credit payments to your net household income. It is calculated by taking your total monthly payments times 100 on your net salary. For example, if your net salary is 3000 euros and your monthly loan is 500 euros, you do this operation: (500×100)/3000=20%.

Be at least 25 years old and financially sound

. Banks also consider your age before giving you a loan. The age requirement for borrowing money from a bank, is at least 25 years and no more than 70 years. It is very difficult for these financial institutions to trust a young person who does not have enough experience. Similarly, older people also find it difficult to make loans. You must be financially sound before you are eligible to borrow money for your project. Banks will not lend money to people who have difficulty taking care of themselves. So these are the recurring conditions for getting a loan from a bank.