Creditworthiness is determined by financial strength, including the robustness of future earnings, capital and liquidity and the resilience to external factors.
Assessment of your creditworthiness and approval of individual facilities take place on the basis of an overall assessment of the household's financial circumstances and credit strength profile as well as any danger signs measured relative to Nykredit's total exposure to the household, and on the basis of standard financing.
The assessment includes the following:
- Current and expected future income (age, education, job etc)
- Spending pattern and payment behaviour
- Current and expected future disposable income
- Current and expected future debt obligations measured relative to income (debt-to-income ratio) as well as debt structure
- Household wealth and wealth development
- Any danger signs – including registration in a bad debtor register, overdrafts/arrears, overdraft interest, underpaid taxes, credit cards, unsuitable debt structure, frequent borrowing etc
Standard financing means fixed, defined interest rate and repayments and a specified repayment period. In respect of lending for housing purposes, standard financing terms mean a 30-year mortgage bond loan with repayments carrying a loan rate at least equal to Danish fixed mortgage rates, and any financing beyond the statutory loan-to-value (LTV) limit in the form of a bank loan with repayment over a maximum term of 30 years.
In connection with the credit assessment, Nykredit will collect the following information:
- Latest tax assessment notice and other information from the tax authorities
- Latest annual statements from banks and other lenders
- Direct debit pre-notification statement
- Pay slip(s)
- Nykredit budget •Customer's own budget
- Account statements from other banks
- Loan prepayment notes
- Contracts of sale
- Proceeds calculations
- Leases for rented dwellings
- Divorce settlement agreements
- Instruments of debt between children and parents
- Statements of personal net worth, including car prices, account statements, property valuation* (presumably stored in property valuation system)
- Annual financial statements and current interim balance sheet (if applicant and/or spouse is self-employed)
- Various correspondence from customer
- Construction contract
- Specification of construction costs
Please note that the list is not exhaustive and it may be necessary to collect further information.
Nykredit may also obtain data from consumer credit rating agencies and, if relevant, the register of defaults with the French central bank.
It is important that you provide accurate and adequate information for the purpose of the credit assessment. Nykredit cannot grant a loan if we are unable to make an adequate credit assessment and the reason is a failure on your part to provide the relevant information.