Imagine you are a landlord processing new applications, just 2 tenants remain. Everything is equal except tenant A has been self employed for 6 months and tenant B has been employed by the same company for the last 10 years.
Stats tell us that most new businesses fail.
Who would you pick?
————
Looking at years of historical bank statements and credit history presents a good understanding. Length of time with current employer. Gaps between employment. Savings. Job type. It’s easy to build a picture.
There is a direct link between amount of disposable income and likelihood of defaulting.