2112 documentary requirement the request papers

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2.1.12 Documentary Requirement The request papers should preferably be prepared for before applying for a bank loan, incomplete documents can cause delays. The following documents are commonly asked for. Residence certificates tax players’ identification number. BIR stamped tax declaration for the past three years, financial statement for the past three years, bank & grade references. Mini-business plans or projects feasibility study; especially for borrowers who are just starting in business. Business registration papers for single proprietorship, registration with the department of trade and industry and with the municipal office. For partnerships, articles of partnership and joint resolution to borrow-for corporations, security and exchange commission critical articles of incorporation with by-laws, boar resolution to borrow and stock holder bio data for corporative, registration with the because of cooperative department.
14 Paper pertaining to collateral: for real estate mortgage copy of TCT location plans with vicinity map, tax clearance, tax receipts, tax declaration, insurance floor plan or pictures. For chattel, registration certificates, insurance loan (credit) evidencing payment in the case of important equipment for exporters’ letters of credit, confirmed purchase orders and sales contracts. 2.1.13 Credit Investigation The company’s background and history covering the date of registration (in corporation), the type of business organization, records of registration name of incorporators, and a summary of operating records. Financial condition: the current break down of financial statement reflecting the result of operations for the past three years. Dealing with government agencies; the lending bank checks on the credit availed of by the applicant form lending government agencies, the nature of the loan. Collateral offered, and installment payment, including arrear ages if any. Court asset; the bank cheeks on civil and criminal case involving credit applicants. It also obtains information of the applicant from compotators. After the credit investigation and supporting have been accomplished and evaluated, a recommendation for approval is prepared and the release of the loan is facilitated. 2.2 Empirical Review Agresti et al,(2008). The need to give due attention to borrower, thus need not be overemphasized in order to ensure loan performance. There is a tendency by borrowers to give better attention to their loans when they perceive they got better attention. Some of the loans defaults ascribe to lower level of attention given to borrowers. It is advised that banks keep up with their loans timely. It is clear that effective credit monitoring involves looking into various operations of the company including operations of the loan, checking whether the company is properly managed, and the environment in which the company is carrying out its business is satisfactory.

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