When looking for a loan we need to meet with certain conditions. Normally, people try their best to keep up with a good credit score and believe that is all they need, ignoring there are other crucial factors to fulfill in order to be eligible for one.

If you are in the search for an auto loan, a mortgage/refinancing loan or a personal loan, it’s very important to be aware of all the key elements that will enable you to get it without any problems. In this post I will break down for how to determine if you are a good candidate for a loan.

How to determine if you are a good candidate for a loan

¿Do you have a good credit score?

Of course, the credit score is going to be the most important aspect to keep in mind if we expect to get a loan since it will indicate if we are loan-worthy.

If our credit score is low, we need to accept the fact that the lender will find us to be a risky bet so, first things first:

Try to keep your credit score at 700 or higher to increase your chances. At 650 there is still the possibility to be eligible so, if you are still under these numbers try paying down your current debts to clean your score a little bit and check your credit reports for possible errors that might put you in a rough spot.

There’s also the possibility of getting a bad credit loan, even if your credit score is not optimal, the idea in these cases is to learn how to apply for those. In case this idea fits your circumstances, veteran trust worthy sites like creditloan.com will offer you with everything you need to understand and get the best out of bad loans.

¿How does your income and employment history look like?

This aspect is very important to keep in mind since lenders need to be sure your income is good enough to cover all the payments and you are solid rock in a year-round employ. Seasonal jobs and self-employed people will, most likely, have the harder time in getting their desirable loan

I any case, make sure you don’t ask more than you can cover. Consistency in every payment will be the most desirable thing for the lender but also consider: the shorter the period of the term, the better. Paying in less time will save you some money in interests and will make you easily eligible for a future loan.

¿Is your debt-to income ratio reasonable?

This element is fundamental. Ask yourself how much is left of your income after paying your current debts. If the answer doesn’t make you happy, it will not make happy a lender either.

For this reason, your capacity will be key in order to get the loan, this is why it would be wiser to have some savings to put the chances on your side, but these topics will be addressed later on this article.

¿Are you willing to accept a collateral for a secured loan?

Some loans involve a collateral, which is an agreement where you compromise to give something in return to the lender in case you can’t pay back.

Luckily, not every loan will require a collateral from you, but this is a good reason to make sure you fulfill all the previous elements.

Some people prefer to seek for help in this regard directly from government loans; this is also a valid option, just keep in mind that these ones will most likely require a collateral, which might not be ideal for everyone.

¿Are you in a good position in terms of liquid assets?

In occasions, lenders tend to be more flexible with loans if the borrower has savings or liquid assets that can easily be turned into cash. This assures them that you will be able to keep up with your payments even if a terrible situation turns up (losing a job, unexpected emergencies).

It would be a good idea to make sure having some savings before applying for a loan and to take extra cautions after in order to avoid the stress of being near to the payment date without being able to do it.


As stated in this post, being a good candidate for a loan takes more than just credit score. Yes, this point is key, but it is important to meet certain conditions in order not only to get it, but to be able to pay it down without pressure under our shoulders.

Remember considering your employment status and income as a big factor to get a loan; year-round jobs will be more desirable for the lender since it means consistency in payments and your income should meet the expectations of the amount you are trying to borrow.

Also, collateral and liquid assets will be key depending if you are looking for secured or unsecured loans so keep that in mind also.