7 Personal Finance Terms You Should Know
Five C’s of Credit
The Five C’s of Credit is an evaluation method lenders use to determine whether to extend you credit. They are as follows:
1. character: your reputation
2. capacity: your ability to repay the debt in a timely manner
3. capital: any financial resources you may have, such as income
4. collateral: any large assets (property for example) that you’re willing to put as a guarantee in case you default on the loan
5. conditions: the terms of the loan, such as interest rate