How Banks Select Borrowers vs. How VEDC Lends Money to Unconventional Borrowers

2018-01-11T18:07:11+00:00June 25th, 2015|Blog|2 Comments

The selection of borrowers by any lender can be a complicated process. Lenders consider a variety of factors when deciding to extend a line of credit to a borrower. Anything from a credit score to employment history will help a lender determine if they will approve a loan. Every lender has different requirements or standards that a borrower must meet in order to qualify for a loan.

However, banks and micro lenders differ greatly in the type of borrowers they approve for loans. A bank has a very stringent loan authorization process and will usually only give loans to borrowers that satisfy their high standards for credit approval. Micro lenders, like the Valley Economic Development Center, do not adhere to the same strict requirements that prohibit banks from extending loans to borrowers.

Rule of thumb

VEDC’s rule of thumb is credit, cash flow, collateral. We need to see two out of the three. This allows VEDC to extend loans to more unconventional borrowers that would usually be rejected by larger banks.

Apply now, or find educational resources to increase your credit approval ratings.

2 Comments

  1. counters October 20, 2018 at 2:49 pm - Reply

    Hello, i just planned to drop that you a line to say that we totally
    enjoyed this particular post from yours, I have subscribed to your
    Feed and have absolutely skimmed several of your articles or blog
    posts before and enjoyed every bit of them.

  2. Kurt October 22, 2018 at 6:18 am - Reply

    Thank you for superb post. Keep us posted.

Leave A Comment

Sign up for the newsletter
Get news from VEDC and the small business network delivered directly to your inbox.
By registering you accept the Terms and Privacy Policy.
Register
Sign up for the newsletter
Get news from VEDC and the small business network delivered directly to your inbox.
Register
By registering you accept the Terms and Privacy Policy.