What are Credit Documents?

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. In other words, banks and credit unions look to credit documents as an indication of a customer’s financial track record and capacity to repay borrowed money.

Examples of Credit Documents for Consumer Loans

Most consumer loans in the United States depend on the borrower’s credit score. Even so, consumer loans still require confirmation of identification for the customer, such as a driver’s license. Furthermore, the bank may need a W2, tax return, and CIP document.

Examples of Credit Documents for Commercial Loans

Required credit documents may vary depending on the type of commercial account and its formation.

Generally speaking, however, banks will likely ask for the following information for new commercial accounts:

• Articles of incorporation / organization
• Operating agreements
• Bylaws
• Corporate financials
• Accounts receivable statements
• Inventory statements

Banks often ask business owners to provide personal documentation, too. Such requests may include tax returns and credit reports.

Furthermore, throughout the life of the loan, banks may need to collect updated credit documentation to ensure ongoing creditworthiness of the commercial customer. Additional financial statements and tax return documents are common examples.

Managing Credit Documentation

Historically, banks relied on paper folders and shared network drives to manage credit documentation. Leveraging a core-integrated document management system, such as AccuAccount, provides an opportunity to increase credit document management efficiency. Automated exception reports keep lenders informed about missing credit documentation with minimal effort.

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