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July 31, 2019

Essential Documents You Should Have to Make Loan Application Easier For You

We wish we could say that loan application is easy. If you plan to borrow in big banks, then you need to get the necessary documents ready for them to process your loan application. At the same time, these documents will serve as proof of your identity and for them to get to know you better.

The question is this: what documents should you prepare?

Here’s what:

  1. Proof of Identification

This is a must. Lenders are wary of approving every loan application because they need to know that a real person exists behind that identity. This is why you need to get those IDs ready – government-issued ID, to be exact.

You can present:

  1. Philippine passport
  2. Driver’s license
  3. GSIS ID
  4. PRC ID
  5. OWWA ID
  6. Unified Multiple-Purpose ID (UMID)
  7. Integrated Bar of the Philippines (IBP) ID

Aside from these primary IDs, you can also present the following:

  1. TIN ID
  2. SSS Card
  3. Voter’s ID
  4. Company ID
  5. Postal ID
  6. Any government office and GOCC ID

 

  1. Proof of Billing

It seems funny for some, but submitting any proof of billing means a lot for lenders. Through this, lenders can tell whether the address you indicated in your loan application form is real and existing. The address is also where lenders can send letters or reminders in case you missed your payment.

You can submit any of the following billing statements:

  • Meralco bill
  • Phone company bill
  • Credit card bill
  • Cable bill
  • Other utility bills

 

  1. Proof of Income

This is the most important document you need to submit. Lenders are particular in this because at the end of the day, they need to know that they will be paid no matter what. The best way to assess your capacity to pay is by presenting proof that your income can cover for the loan, regardless if you are a freelancer, business owner, or an employee working in a company.

You can submit any of the following that will show your capacity to pay:

  • If employed, a Certificate of Employment you can get from your company’s HR department. This contains your position in the company, how long you are working with the same company and other details about your compensation. Make sure that this is not older than one month.
  • If self-employed, documents that will prove the existence of your business such as Mayor’s Permit, Business Permit, or DTI or SEC registration.
  • Bank statements that show the amount of deposits you have in bank/s. This will also serve as an alternative means to pay for the loan, although this document is more recommended for business owners or self-employed individuals.
  • BIR Form 2316 or Certificate of Compensation Payment/Tax Withheld, which contains your gross annual income. This is only applicable for employed individuals.
  • BIR Form 1700 or 1701, which is the Annual Tax Income for self-employed individuals.

Depending on the loan, some lenders require more than this such as collateral documents. Nonetheless, these documents are what majority of lenders need to process your loan.

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