This is the concern of many people when they apply for a mortgage. The answer is that, as a general rule, banks or other lending institutions check for letters of credit when approving a mortgage. Specifically, the following is an analysis of the issue from several angles。

I. WHY DO THE BANK FINDINGS

The reason the bank would request the borrower to provide a letter of credit report before the loan was that the letter of credit report recorded the borrower ' s credit history and repayment records. The bank can look at the borrower's letters of call to understand the borrower's debt and repayment capacity. If the borrower ' s credit record is poor, the bank questions whether the lender has sufficient repayment capacity. If the bank decides to grant the loan, the borrower is sometimes required to provide some security. This minimizes the risk to banks。

II. Impact of letters of request on the approval of mortgages

FOR BANKS OR OTHER LENDING INSTITUTIONS, LETTERS ARE AN IMPORTANT BASIS FOR DECISION-MAKING. AS A RESULT, LETTERS OF CREDIT REPORTS WILL HAVE A DIRECT IMPACT ON THE BORROWER ' S APPLICATION FOR A MORTGAGE. BANKS USUALLY DIVIDE THE BORROWER'S CREDIT RECORDS INTO LEVELS A, B OR C. LEVEL A MEANS THAT BORROWERS HAVE A BETTER CREDIT HISTORY, WHILE LEVEL C MEANS THAT BORROWERS HAVE A POOR CREDIT HISTORY. IF BORROWERS HAD BETTER CREDIT RECORDS, BANKS WOULD NORMALLY BE WILLING TO GIVE THEM A BETTER LOAN RATE AND A MORE FAVOURABLE REPAYMENT PERIOD. CONVERSELY, HIGHER INTEREST OR SECURITY MEASURES MAY BE REQUIRED. LETTERS OF CALL THEREFORE HAVE A VERY IMPORTANT IMPACT ON THE APPROVAL OF MORTGAGES。

III. How to view the impact of letters of credit on mortgages

The letter-writing records have a very important impact on mortgage applicants. It was therefore important for those who wanted to obtain a mortgage to maintain a good credit record and ensure that repayments were made on time. At the same time, the record of letters is an effective way of assessing personal credit, and it should also be fully recognized by borrowers. In addition, it should be recalled that applying for different loans from a number of banks or lending institutions may also affect the receipt of letters. The large number of search records may have a negative impact on the letter rating。

Conclusions

In general, it is very common for mortgage approvals to obtain letters of credit through pre-lending banks or other lending institutions. The bank assesses its liability and repayment capacity through the borrower ' s letter-in-writing report, and on this basis decides whether to grant a loan, as well as economic conditions such as the interest rate on the loan and the repayment period. Therefore, those who want to obtain a mortgage need to be careful to maintain a good credit record and ensure that repayments are made on time。