Ask Mr: the loan-readiness interview

Why Mr runs an interview instead of a calculator

Most loan tools ask how much you want and spit back a repayment. That's the easy part. The hard part — the bit that decides whether an application glides through or stalls for three weeks — is everything around the number: how long you've traded, what the money is for, whether the ATO is happy with you, what your credit file says and whether you can produce the paperwork a lender reads first.

So the interview asks the questions a good lending specialist would ask on your first call, in the same order, and tells you honestly how the answers are likely to land. It doesn't ask for an interest rate or spit out a repayment, because pricing depends on your circumstances and only a real assessment can settle it.

How to read your verdict

The readiness meter is a rough guide, not a score a lender will ever see. It rises with trading history, steady turnover, a clean ATO position, a tidy credit file and documents you can send quickly. Property with genuine equity lifts it too, because security gives lenders more room to say yes when other parts of the picture are untidy.

• Ready for a proper conversation — most of what a lender checks is in order. Gather the documents listed and enquire.
• Close — tidy up a couple of things — you can probably borrow, but one or two items will slow things down or narrow your choices. Fix them in parallel with the conversation.
• Worth a conversation, with a plan — there are hurdles, but plenty of owners in this spot still find a route, often with property security or a smaller first step.

The four lists, explained

What lenders will likely ask turns your answers into the follow-up questions you'll hear, so you can have the answers ready. Loan types worth discussing narrows the field to the structures that suit your security, timing and purpose — for example a property-secured loan between $20k and $5m, or an unsecured facility sized on turnover. What to fix first puts the slow items at the top. Documents to gather lists what you said you don't have yet, plus anything your purpose adds.

Want the words decoded as you go? Mr's loan jargon decoder translates the terms in one line each, and the answers on what a lender looks at first and which documents matter go deeper on every part of the interview.

When to skip straight to a person

If you have a hard deadline this week — a tax bill, a settlement date, a supplier who wants paying — don't over-polish. Start the 60-second enquiry and say what the deadline is. A specialist can often work on the paperwork with you while the conversation is underway.