The extension of credit ensures the seamless flow and circulation of money, thus, allowing the economy, as a whole, to progress. Businesses and individuals alike would often apply for credit, and other forms of loans, so that they could continue their pursuit of profit or to buy things that their wallets couldn’t afford to pay. From securing a letter of credit for a consignment of goods imported from overseas to getting a new house or first car, credit is the one of the most convenient ways to acquire those things whenever paying in cash is literally impossible.
37+ Credit Application Forms in PDF | MS Word | Excel
1. Government Credit Application Form
2. Business Credit Application Form
3. Credit Card Choice Application Form
4. Electronics Credit Application Form
5. Credit Application for Registration Form
6. Agriculture Credit Application Form
7. Credit Application Update Form
8. New Customer Credit Application Form
9. Credit Facility Application Form
10. Bank Credit Application Form
11. Add on Credit Application Form
12. Credit Terms Application Form
13. Confidential Credit Application Form
14. Buyer Information Credit Application Form
15. Student Credit Application Form
16. Company Credit Application Form
17. New Account & Credit Application Form
18. Sole Trader Credit Application Form
19. Transfer Credit Application Form
20. Corporation Credit Application Form
21. Logistics Credit Application Form
22. Customer Credit Application Form
23. Credit Account Application Form
24. Business Information Credit Application Form
25. Property Credit Application Form
26. Commercial Credit Application Form
27. Credit Application Reset Form
28. Supplier Credit Application Form
29. Credit Application Email Form
30. Trading Credit Application Form
31. Credit Application Agreement Form
32. Credit Reference Application Form
33. Credit Application Company Information Form
34. Credit Trade Application Form
35. Merchant Processing Credit Application Form
36. Documentary Credit Application Form
37. Credit Department Application Form
38. General Credit Application Form
What is Credit?
Credibility and trustworthiness are the bread and butter of lending money and extending credit. The word credit itself owes its origin from the French word, credere, which means to trust, entrust, or believe. The lack of any of these two, on the borrower’s end, would remove all the possibilities of securing a loan or credit.
Credit is a grant extended by the lender to the borrower in the prospect of receiving payment in the future. It could either be money borrowed for personal or commercial use, or goods and services bought and availed for in the present, which will be paid in whole or through installment. It means that credit allows borrowers to enjoy the benefit of acquiring and possessing goods in times where immediate payment is impossible at that moment.
Since credibility and trustworthiness are the bread and butter of lending money and extending credit, creditors would not grant such privilege without being sure if they can trust the borrower beforehand. That is why creditors, on their part, require borrowers to provide proof of the capacity for payment and authenticity of their character before credit is extended to them.
Credit: Its Major Types and Application Requirements
Credit comes in many forms, in different shapes and sizes. Each of its various forms for particular commodities that you wish to acquire now and pay for on a later date. And with each type of credit, comes with its own application forms that must be submitted along with supporting documents to establish the borrower’s credibility and trustworthiness.
Every credit application that a borrower must complete has its own requirements. However, the most common of these are financial documents that give proof of a borrower’s capacity to pay for the amount of cash borrowed and owed, and government-issued identification cards to ascertain the borrower’s identity. All of those documentary requirements are used for one goal only, and that is for the borrower to establish rapport with the lender.
Whether it is for personal use or securing capital for your business, for sure, there is a type of credit, suited for your needs. And, listed down below are the two major types of credit that regular Joes and business entities alike commonly make use of.
- Consumer Credit: Credit cards, car loans, and appliances on installments. All of these are a few of the examples of consumer credit. Consumer credit is a type of credit that people, like you and I, avail for when paying for things when our wallets are out of cash or when paying on a cash basis is not viable at that moment. To pay for the amount that we owe for our purchases and expenses, creditors would usually send us a bill that we will have to pay periodically.
- Commercial Credit: Whenever a business needs to meet its operating expenses and can’t finance them, they would usually apply for commercial credit in order to meet them. Commercial credit is a type of credit extended to businesses in order to provide them additional capital for them to be able to run it. The few of its examples are letters of credit, business credit, and consignment contracts.
Applying for Credit: What’s in It for You?
Cashless payment is becoming more popular today, despite the portability of paper money. Credit cards, for example, allows its users to shop and pay for almost anything, anytime, and anywhere, without the burden of carrying large sums of money with them. A cover for the expenses, credit card holders are billed periodically to pay for the amount owed for the purchases they made through beforehand.
Credit, in general, extends one’s purchasing power as well a providing convenience as opposed to the limitations that carrying cash in wallets have. And as a means of deferred payment, it also allows one the possibility of paying for something in times when one doesn’t have the actual capacity to pay for it, for the meantime. The advantages that credit provides to its users explains its popularity among average Joes. In fact, about 67 percent of Americans own and use credit cards in their transactions. Whether it be for paying their monthly bills or for grocery shopping, the majority of their expenses are always paid through credit.
Credibility, Capacity, and Capital: What are these 3 Cs For?
Trust and a good reputation are the primary pre-requisites for lenders to extend credit to borrowers. Thus, in order to establish trust and a good reputation to our lenders, we must first establish the three Cs of credit. These three Cs are, namely, our credibility, capacity, and capital. Each of these Cs has its own unique definition, yet, perfectly complementing each other. The absence of any of these makes it difficult for anyone of us to secure credit from lenders, let alone get an opportunity to talk with them. What’s more, these three plays a more important role when applying for another credit from another lender.
Perhaps the most important of these three is credibility or a good word about your character. A good word about your character lets the lender know pretty much about you, especially if it gives them a hint of how a reliable person you are. Aside from that, it also lets them know if the kind of life that you’re living affects your ability to pay for the debt. More importantly, it allows lenders to ascertain the degree of honesty the moment you signed the promise to pay the debt on time.
The next important characteristic that lenders look for in a borrower is their capacity to pay for the debt. The capacity to pay for the debt means that the borrower has a stable means of income to cover for the amount owed. For lenders to ascertain a borrower’s capacity, documentary proof such as employment papers or business certificate is furnished before them so that you can get their nod of approval. Upon showing such documents, make sure that they’re up to date, prior to submitting your credit application.
Lastly, capital or the proof that you have the amount of money to cover for the debt is among the things that lenders need from them to have a peace of mind. What this means is that your income should be able to match the amount that you need to pay your debt with. Documents such as payslips and tax statements should be shown to them to provide proof that you can pay for the debt itself. When showing these documents, make sure that they’re up to date, the same with other documents.
Credit in the Olden Days
People back in the old days, used to make purchases using hard currencies carried inside leather pouches, slung on their waists or kept inside pockets within their robes. However, when it comes to buying properties, commercial or not, purchasing on credit or by deferred payment would be their usual course of action. Romans, for example, made use of credit when purchasing real estate such as land and houses. Such transaction was mentioned in some of Cicero’s writing, particularly his neighbor’s purchase of a house by which he described as “nomina facit, negotium conficit”—He uses credit to complete the purchase.
Credit in the olden days is usually reserved for the nobility and the well-to-do. During the age of mercantilism, credit was used extensively by merchants to purchase goods on consignment, rent cargo spaces in sea vessels, or even as an addition for their existing capital. And, it was also during this age that exploring for another route to the east and other remote parts of the world intensified. Sea voyages of such magnitude would have involved massive amounts of equipment and capital. For sure, most of these voyages are financed by credit.
How To Submit Your Credit Application
From buying your first car to securing your own house, it is hardly possible to get them by paying cash on the spot. This is mainly because of the huge amount that it costs, which no wallet nor purse could carry and pay for, all at once. What’s more, there are instances where carrying cash in your wallet is more of a nuisance than its a convenience, especially when what is left inside them is a loose change or your wallet leaving an awkward bulge on your brand new jeans.
Speaking of convenience, paying for almost anything through credit allows you to buy your favorite candy from your favorite convenience store, pay for your internet bills when its due is almost past, or go on a shopping frenzy on amazon during black Friday. All of which are things that you can’t do in a jiffy by depending on how much cash you have inside your wallet. What’s more, it allows you and your pocket to go light and carry less by
Step 1. Pay your Bank a Visit
When planning to apply for a loan or credit, you need to pay a visit to any financial institution that offers such services to its clients. Banks, for example, are the most common and perhaps the oldest financial institution that extends credit to their clients, aside from credit and lending companies. Visiting them allows you to make inquiries about a variety of credit plans that they offer and even give you advice on how to pay for them as well. Upon visiting your bank, make sure to look for their loan officer so that you can discuss the most suitable plan, tailor-fit to your needs.
Step 2. Talk to the Bank’s Loan Officer
Upon visiting your bank, look for their loan officer so that you can ask which type of credit is the most suitable for you. Banks usually have a wide array of credit plans and loans extended to their clients, such as student loans, housing loans, car loans, and business credit. You can also ask for advice with regards to the payment terms and interest rates that fit within your budget. Aside from that, this is the time where you should also ask about its documentary requirements so that you will be able to prepare them before submitting your credit application.
Step 3. Grab a Credit Application
After discussing the terms of credit that you applied for with the bank’s loan officer, the next thing to do is ask for a credit application form from the bank itself. Like any application form, a credit application form is one basic requirement in securing credit and is used to determine the credibility and trustworthiness of an applicant based on the information written on them. It is also used as a starting point from which an electronic profile of the applicant is created to process the loan further once the documentary requirements are submitted.
Step 4. Prepare Supporting Documents
Banks and other financial institutions usually require applicants to submit supporting documents along with their application forms to determine the applicant’s credibility and trustworthiness as well as prevent possible fraud. These documents are usually your billing statements, current payslip, employment history, and other documentary proof of your capacity to pay. An application letter may also be required to be written, as well. To prevent any delays in your credit application, make sure to prepare and place them in a single envelope along with the application form.
Step 5. Submit Them All Together
Now that you’ve completed and signed the credit application forms and its supporting documents prepared, the next and last thing you should do is to submit them all together. But before you do that, make sure to double-check the application form and its supporting documents to avoid any delays. Submitting them will have your credit application processed immediately, and approved in the shortest time possible. And, if you’re lucky to have your application approved, you will then sign another set of documents such as contracts and agreements.
With the convenience and expansion of one’s purchasing power that credit gives to each and one of us, it’s no surprise that the world is, indeed, ran by credit. Besides the ability to acquire things and pay for our dues in the absence of money, credit also allows us to measure one’s character and personality based on how timely a person pays for what he owes.
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