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5C's Of Credit

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5C's Of Credit

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  1. 5 5C's of evaluating a borrower. It helps the lender know the borrower’s ability to repay the loans. Of Credit A borrower’s credit position speaks volumes about their financial situation. 5 C’s of credit is a method Character It refers to the borrower’s reputation, track record & credibility. Lenders wish to make sure that the borrower is a responsible individual who would make payments on time. 01 Capacity 02 It is the borrower’s ability to repay the loan. Often a borrower’s debt to income ratio is computed to assess the borrower’s financial condition. Another factor that the lenders might consider is employment stability. Capital The amount of money which the borrower invests or puts forward is known as capital. Contribution made by borrower in this regard gives the lender a sense of security and reduces the chances of default. 03 Conditions Numerous conditions such as principal amount, term of loan, interest rate, etc. influence the lender’s decision. However, some uncontrollable conditions such as state of the economy, industry trends, etc. are also considered. 04 Collateral They are the assets which the borrower pledges as security. This way, if the borrower is unable to repay the loan amount, then the lender can repossess the collateral. It acts as a backup and is taken to reduce the lender’s risk. 05 107 W. Hwy. 190 Copperas Cove, TX 76522 254-542-5100 2201 Trimmier Rd. Killeen, TX 76541 254-680-6158 14641 S. Padre Island Dr., Ste. B Corpus Christi, TX 78418 3106 S. WS Young Dr., Bldg. D, Ste. 402 Killeen, TX 76542 254-953-7000 361-949-4647 10961 Gateway Blvd. West, Ste. 200 El Paso, TX 79935 915-843-2681 8522 Broadway St., Ste. 208 San Antonio, TX 78217 210-340-0404 1320 N. Zaragoza Rd., Ste. 111 El Paso, TX 79936 915-858-1996 7348 W. Adams Ave., Ste. 200 Temple, TX 76502 254-771-0020 16165 North 83rd Ave., Ste. 200 Peoria, AZ 85382 201 E. Central Texas Expwy., Ste. 1600 Harker Heights, TX 76548 254-680-6155 480-752-3110 100 W. Central Texas Expwy., Ste. 300 Harker Heights, TX 76548 254-690-3765 www.fcmloans4u.com

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