The reason the bank has given for the initial decline on my home loan was due to my scorecard. Please explain what is meant by a scorecard?

Kay Geldenhuys, Property Finance Processing Manager at ooba answers:

A common method which banks utilise for predicting credit risk is through their credit scorecard. The scorecard is a statistically based model for attributing a number (score) to an applicant which indicates the predicted probability that the customer will exhibit a certain behaviour. In calculating the score, a range of data sources is used, including data from the home loan application form, from credit bureaux and, where applicable, from products the customer already holds with the lender.    

Banks have been utilising and developing their scorecard over many years of credit lending and therefore have access to a huge range of scorecard data which is utilised to predict behaviour.  Banks’ individual credit policies rules and regulatory requirements are also included in their credit scorecard results.