Applying for a loan: The criteria

In assessing any loan application, alternative lenders do not rely on the computerised credit scoring methods now widely in place among mainstream lenders. Lenders in the alternative loan market carefully assess each borrower on his or her merit, looking primarily at their debt repayment track record, often then assigning a ranking.

However, categories are not set in stone across the market. Borrowers should be aware that a lender may often be unable to quote a rate "on the spot" or over the telephone without a detailed assessment of individual circumstances.

An alternative lender will look primarily to the following criteria in making a risk assessment:

• Employment status


• Income


• Repayments record over the past twelve months.


• Overall credit history

Joint borrowers

Where there is more than one borrower, the factors above are assessed for each borrower and weighted according to each borrower's adjusted annual gross income.

Read our tips for borrowers of non-conforming loans