The Nature of the Credit Decision and the Role of Credit Scoring

The ultimate decision of whether to lend to any specific applicant, is not a "science" involving strict mathematical formulas. Rather, it is an "art" that relies heavily on various underwriting factors that are assigned differing weights depending on the experience or risk preference of the lender or investor. There are a myriad of factors that come into play in mortgage lending determinations. Some of the more common factors analyzed by underwriters are loan-to-value ratios, debt-to-income ratios, bank reserves, down-payment size, down-payment source, loan type, loan duration, among many others. Credit scoring is just one factor in the analysis. The "art" of underwriting does not lie in assigning numerical values to any of these factors, along with "pass" or "fail" ratings. Underwriting requires that each factor be accounted for and interpreted in light of the other factors and in the context of each applicant and property. In the end, the final decision is based on a judgment call regarding the full set of circumstances that are unique to each borrower and each transaction.

Avoiding Credit Card Disaster

Avoiding Credit Card Disaster

People who struggle with saving money and getting out of debt will find these things in common: They don't know how to stop blaming. They have no idea where their money needs to go! They don't know they need to forget the home equity line. They also don't understand they need to sell some investments. Many more problems untold. Well don't worry, With the strategies that I’m about to let you in on , you will have no problems when it comes to understanding how to get out of credit card debt.

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