Consumer Lending Underwriting 101: From Application to Approval
Proper analysis of consumer loan requests is more important today than any time in the history of banking. This is because of the continued impact of Covid-19, which negatively affected many consumer borrowers.
More recently we’ve seen an increase in consumer debts outstanding, and an uncertain economic environment caused by a myriad of economic influences. All of these may cause consumer borrowers to be in a weaker financial condition.
For these reasons, and the need for institutions to continue growing the consumer loan portfolio safely, it is important for financial employees to adjust their lending practices to ensure the next consumer applicant is not becoming overextended and unable to meet their obligations.
