Credit Analysis Tab

The Credit Analysis tab provides detailed underwriting analysis, including debt-to-income calculations, decision factors, rule results, and the overall credit decision. This tab is essential for understanding why an application was approved, declined, or sent for manual review.

Tab Overview

The Credit Analysis tab includes:

Section	Description
Decision Summary	Overall underwriting decision
Debt-to-Income (DTI)	Income vs. debt analysis
Decision Factors	Key factors affecting decision
Rule Results	Detailed rule evaluations
Risk Assessment	Risk scoring and categorization
Manual Review	Override and exception handling

Decision Summary

Decision Status

Decision	Description	Next Steps
Approved	Application meets criteria	Proceed to closing
Declined	Does not meet criteria	Send adverse action
Counter Offer	Approved with different terms	Present counter
Pending Review	Needs manual review	Underwriter review
Referred	Specific condition to address	Address condition

Decision Details

Field	Description
Decision	Approved, Declined, etc.
Decision Date	When decision was made
Decision By	System or user name
Decision Reason	Primary reason code
Approval Amount	Approved loan amount
Approval Rate	Approved interest rate

Debt-to-Income (DTI)

DTI Calculation

DTI = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100

Example:
Monthly Debt Payments: $2,500
Gross Monthly Income: $7,500
DTI = ($2,500 ÷ $7,500) × 100 = 33.3%

DTI Components

Income:

Source	Monthly Amount
Primary Employment	$6,000
Part-time Job	$1,000
Rental Income	$500
Total Income	$7,500

Debt Obligations:

Obligation	Monthly Payment
Mortgage/Rent	$1,500
Auto Loan	$450
Credit Cards	$300
Student Loans	$250
Total Debt	$2,500

DTI Types

DTI Type	Calculation	Typical Max
Front-End	Housing only ÷ Income	28%
Back-End	All debt ÷ Income	36-43%
Proposed	Including new loan	45-50%

DTI with New Loan

Current DTI:        33.3%
+ New Loan Payment:  $311
New Total Debt:     $2,811
Proposed DTI:       37.5%

Decision Factors

Positive Factors

Factors that support approval:

Factor	Impact	Description
✅ Good Credit Score	High	Score above threshold
✅ Low DTI	High	Debt manageable
✅ Stable Employment	Medium	2+ years same employer
✅ Existing Relationship	Medium	Current member
✅ Adequate Collateral	Medium	Good LTV ratio

Negative Factors

Factors that work against approval:

Factor	Impact	Description
❌ Recent Delinquencies	High	Late payments in 12 months
❌ High Utilization	Medium	Credit cards maxed
❌ Short Credit History	Low	Limited credit file
❌ Multiple Inquiries	Low	Recent credit seeking
❌ Collections	High	Unpaid collections

Factor Weighting

Each factor has a weight in the decision:

Factor                    Weight    Score    Contribution
─────────────────────────────────────────────────────────
Credit Score              30%       85       25.5
Debt-to-Income           25%       70       17.5
Payment History          20%       90       18.0
Employment Stability     15%       80       12.0
Collateral              10%       75        7.5
─────────────────────────────────────────────────────────
Total Decision Score                        80.5 (Approved)

Rule Results

Rule Groups

Rules are organized into groups that run at different stages:

Group	When Evaluated	Purpose
Pre-Bureau	Before credit pull	Initial eligibility
Soft Inquiry	After soft pull	Pre-qualification
Hard Inquiry	After hard pull	Full underwriting
Stipulation	During processing	Condition checks
Fraud	Throughout	Fraud detection

Rule Types

Type	Description
Eligibility	Can applicant apply?
Qualification	Does applicant qualify?
Pricing	What rate to offer?
Conditions	What stipulations needed?
Limits	What amount approved?

Rule Evaluation

Each rule shows:

Field	Description
Rule Name	Name/description of rule
Result	Pass, Fail, N/A
Actual Value	Applicant's value
Required	Rule threshold
Action	What happens if fails

Sample Rule Results

┌─────────────────────────────────────────────────────────┐
│ Rule: Minimum Credit Score                              │
│ Status: ✅ PASS                                         │
│ Actual: 725 | Required: ≥ 620                          │
├─────────────────────────────────────────────────────────┤
│ Rule: Maximum DTI                                       │
│ Status: ✅ PASS                                         │
│ Actual: 37.5% | Required: ≤ 45%                        │
├─────────────────────────────────────────────────────────┤
│ Rule: No Recent Bankruptcies                            │
│ Status: ✅ PASS                                         │
│ Actual: None | Required: None in 7 years               │
├─────────────────────────────────────────────────────────┤
│ Rule: No Active Collections > $500                      │
│ Status: ❌ FAIL - REFER                                │
│ Actual: $750 collection | Required: < $500             │
│ Action: Refer to manual review                          │
└─────────────────────────────────────────────────────────┘

Decline Types

Three Decline Categories

Type	Code	Description	Re-Application
HARD	H	Definite decline	Must wait period
SOFT	S	Conditional decline	Can address and reapply
PEND	P	Pending more info	Provide information

HARD Decline

Reasons for hard decline (cannot overcome):

Credit score below minimum
Recent bankruptcy
Active fraud alert
Previous charge-off with institution
Does not meet membership eligibility

SOFT Decline

Reasons for soft decline (may overcome):

DTI too high (can add co-applicant)
Insufficient income (can verify additional income)
Missing information (can provide)
Collateral issues (can substitute)

PEND Status

Application pending additional:

Income documentation
Employment verification
Collateral information
Co-applicant addition
Stipulation completion

Risk Assessment

Risk Score

Overall risk assessment:

Score Range	Risk Level	Typical Decision
800-1000	Very Low	Auto-approve
600-799	Low	Approve
400-599	Moderate	Review
200-399	High	Decline likely
0-199	Very High	Decline

Risk Categories

Category	Factors Evaluated
Credit Risk	Score, history, utilization
Capacity Risk	Income, DTI, stability
Collateral Risk	LTV, condition, type
Capital Risk	Assets, reserves
Character Risk	Payment history, references

Manual Review

When Required

Manual review triggered by:

Rule referral
Score near threshold
Exception request
High loan amount
Policy exception
Fraud indicators

Manual Review Process

Application flagged for review
Underwriter assigned
Review decision factors
Request additional info if needed
Make decision with documentation
Approve, Decline, or Counter

Override Process

To override a system decision:

Document business reason
Verify authority level
Complete override form
Supervisor approval (if required)
Override recorded for audit

Override Documentation

All overrides must be thoroughly documented with business justification for compliance and audit purposes.

Adverse Action

When Declined

Required adverse action notice includes:

Element	Description
Action Taken	Specific denial action
Reasons	Top 4-5 decline reasons
Credit Score	Score used in decision
Bureau	Credit bureau source
Rights	Consumer rights disclosure
Contact	How to request more info

Reason Codes

Standard adverse action reason codes:

Code	Reason
01	Amount owed on accounts too high
02	Delinquent past or present
03	Proportion of balances to limits too high
04	Too many accounts with balances
05	Too many consumer finance accounts
06	Length of credit history too short
07	Too many recent inquiries
08	No recent revolving balances

Best Practices

Review Process

Start with decision summary
Review DTI calculation
Check all rule results
Understand decline reasons
Look for override opportunities
Document thoroughly

Exception Handling

Know your approval authority
Document compensating factors
Get supervisor approval when required
Follow policy for exceptions
Track exception performance

Compliance

Send adverse action timely
Use correct reason codes
Maintain decision documentation
Treat applicants consistently
Follow fair lending rules

Continue to Workflows to learn about managing stipulations and underwriting processes.

Tab Overview​

Decision Summary​

Decision Status​

Decision Details​

Debt-to-Income (DTI)​

DTI Calculation​

DTI Components​

DTI Types​

DTI with New Loan​

Decision Factors​

Positive Factors​

Negative Factors​

Factor Weighting​

Rule Results​

Rule Groups​

Rule Types​

Rule Evaluation​

Sample Rule Results​

Decline Types​

Three Decline Categories​

HARD Decline​

SOFT Decline​

PEND Status​

Risk Assessment​

Risk Score​

Risk Categories​

Manual Review​

When Required​

Manual Review Process​

Override Process​

Adverse Action​

When Declined​

Reason Codes​

Best Practices​

Review Process​

Exception Handling​

Compliance​