Loan applications

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  • Loan applications

    I know nothing of finance. Let's just get that out there. Some of these may sound like stupid questions:

    1. Can you only take a loan out at a bank for which you are a member? Can you apply to several loans at several different banks at the same time?

    2. I know loan applications can be done online. Are these just preliminary applications? Would you later fill out one in more depth?

    3. Is it possible that somebody would have a loan application on their computer? As a document, rather than a web page they are filling out? Maybe something done after a preliminary loan?

    Many thanks, everybody.

    Ele...

  • #2
    Re: Loan applications

    Q1. Can you only take a loan out at a bank for which you are a member? Can you apply to several loans at several different banks at the same time?

    You can get a loan at any bank who thinks they can make money from you. The only thing to remember is that banks talk to each other. (They share information on your credit rating - it's part of what you agree to when you apply for a loan)

    So if you apply to 'Bank A' for a loan of $1 million, 'Bank B' will know about it - or at least could know about it for a nominal fee. This brings up some annoying facts though ... they just know that you applied. If you decide NOT to go for a loan through 'Bank A', 'Bank B' may still assume that you'll get the loan later .. so it can still stuff up their willingness to loan you money.

    You can avoid it by giving slightly different details. A variant in your name & address may mean it might not get matched. A not-so accidental typo in your SSN (different enough to fool the check-digit) may be required in the USA as well.

    Q2. I know loan applications can be done online. Are these just preliminary applications? Would you later fill out one in more depth?
    In my very limited experience, they basically spit out a document filled with the information you supplied and 50 odd pages of fine print. (OK - maybe not quite that much).

    At the end of they day, you end up signing the big printout - and initialing every page too. There would be a online copy too, though - which is why it is important to keep your paper copy. Your lawyer will probably find some clauses to strike out (which the lender may accept - they didn't seriously expect to get away with those clauses anyway), but the online copy won't necessarily be updated. That's how it worked for me, anyway.

    Q3. Is it possible that somebody would have a loan application on their computer? As a document, rather than a web page they are filling out? Maybe something done after a preliminary loan?

    Sure. I've got PDFs of my mortgage. I don't see why not.

    Remember, all these cross-checks are great in theory, but it amazing what people get away with.

    John Spano managed to get an $80 million loan approved to buy a hockey team ... when he basically had nothing.

    Mac
    Last edited by Mac H.; 08-06-2007, 11:41 PM.
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    • #3
      Re: Loan applications

      I took out a car loan after I moved to California from a credit union that I used to belong to back in the Midwest.

      The whole thing was done by fax. They sent me the apps. I filled them out and sent them back. etc.

      I suppose all those things could have been scanned into a computer and transferred that way.

      "Until the Lion writes his own story, the tale of the hunt will always glorify the hunter." -African Proverb

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      • #4
        Re: Loan applications

        1. -
        So if you apply to 'Bank A' for a loan of $1 million, 'Bank B' will know about it - or at least could know about it for a nominal fee. This brings up some annoying facts though ... they just know that you applied. If you decide NOT to go for a loan through 'Bank A', 'Bank B' may still assume that you'll get the loan later .. so it can still stuff up their willingness to loan you money.

        You can avoid it by giving slightly different details. A variant in your name & address may mean it might not get matched. A not-so accidental typo in your SSN (different enough to fool the check-digit) may be required in the USA as well.
        Bank B will only know if your credit was ran recently from another bank. Creating a story unrelelated to the purpose for going to Bank A will get you out of that bind. Bank B will not investigate any further if they want your loan.

        If you can close both transactions simultaneously, Bank A and Bank B will not see the loan from one another until it records with the credit bureau OR what ever property title it will be attached to. This occurs after 30 days of your closing.

        2. - There are plenty more to fill out. On paper with wet signatures, in the computer, at the lenders website, in underwriting, etc. So much more details.

        3. - Yes, loan apps are now available and can be generated by downloading from a lenders website. I don't know what a "preliminary loan" is, but the stuff you fill in websites is a general application, almost a marketing tool to produce leads. That application is the basis for them to offer you more or less depending on your qualification and their needs to make a big commission.

        I can't believe I got to use my home mortgage experience in these forums. Thanks ele for making me realize all those years didn't go to waste!

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        • #5
          Re: Loan applications

          Wow. Thank you all. Very, very helpful information.

          In terms of a "preliminary" loan application on a computer...this is what I was trying to figure out: I've gone to numerous bank web pages. Most have online loan applications. But they seem very simple. So I was wondering if those are step 1 of an application. If they like what they see there, then they ask for more information on another application or something. It sounds like that's the case.

          I also wanted to make sure these applications wouldn't just exist as HTML web pages. For the purpose of my story, an editable document on a computer is necessary. I just hope that exists. Anybody know for sure?

          Thanks again!!!
          Ele...

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