Final answer:
A statement by a lender stating they will provide a specific loan amount is known as a pre-approval. To reassure banks, borrowers can offer detailed income information, undergo credit checks, provide a cosigner, or offer collateral.
Step-by-step explanation:
A statement by a lending institution that assures the purchaser that the lender will loan a certain amount of money is a pre-approval
. This is a common practice in the financial capital market that provides confidence to both the buyer and the seller that the funds will be available for a transaction.
To reassure a bank when seeking a loan, a borrower can provide detailed income information and undergo a credit check, to prove creditworthiness. Having a cosigner—another person or firm who legally pledges to repay the loan if the original borrower does not—can also be a valuable approach.
Additionally, offering collateral, such as property or equipment, gives the bank assurance that it can recover the loan amount even if the borrower defaults.