I imagine that some time ago, a community bank might have had loan officers who would know the person or at least the community personally. That would allow the bank to feel confident in writing a loan at lower risk than what the surface financial stats might indicate. Everything is now so financialized into homogenous trade units that I suspect that the original functions of banks to beneficially work out economic inversions like this have faltered.

On the other hand, the $200-300 being charged might represent a risk level of the whole class of rentals being made... it's hard to know without on the ground information.