Financial Services Underwriting Basics Understanding the 5 C’s of Credit!
1. Credit
What is your credit score?
How well do you manage the credit that is advanced to you?
Do you make your minimum payments on time?
Do you remain under 35% on your revolving credit trade line balances?
Do you have accounts in collections
2. Capacity
Your ability to repay loans
The most critical of the 5 C’s
Screening through application of debt service ratios
Careful review of your payment history on existing credit relationship
3. Collateral
The guarantee i.e. the vehicle, the property
The value, location, characteristics of the property
4. Character
The general impression of how trustworthy you are to repay loans
Your length of employment by component of borrowing character
5. Capital
The amount of money that you have invested in the property
May 15, 2012
