When it comes to applying for a mortgage or car loan, lenders want to see whether you've got what it takes. So they look at your credit report. But how do they interpret what they see?

A history of on-time payments and credit card payoffs are diamonds. Lots of late payments and bounced checks are dirt. But there are gray areas where lenders assess other information -- such as how often you've moved -- to decide if they should approve a loan.

Before you even apply for that loan, here's a quick checklist of some basics lenders will evaluate to determine not only whether to say yes, but also to decide the interest rate and other factors associated with the loan.