In general, credit documents are those documents that pertain specifically to the borrower (not the loan). Financial institutions rely on credit documents to provide information about the customer and establish the customer’s creditworthiness.
Entity documents are used by banks for several purposes, such as:
- Verifying that a business or organization exists
- Ensuring that necessary documents have been properly filed by the entity
- Determining which individuals have the authority to establish an account or apply for a commercial loan on behalf of the entity