Five Cs of credit

(redirected from Five C's of Credit)

Five Cs of credit

Five characteristics that are used to form a judgment about a customer's creditworthiness: character, capacity, capital, collateral, and conditions.

Five Cs of Credit

Five factors a lender considers when evaluating whether or not to extend credit to a potential borrower. Importantly, the five Cs of credit include both quantitative and qualitative measures. They are: character (or the borrowers' reputation), capacity (a measure of the borrower's ability to repay by comparing his/her debt service to income), capital available, collateral pledged against the loan, and the conditions of the loan (such as the interest rate, monthly payment, and so forth).

References in periodicals archive ?

A lot of it's about relationships, the five C's of credit, and do your customers have the ability and willingness to pay.

Meet Your 2018 Notional Chairman: Kenny Wine, CCE

8220;For decades banking and investment professionals have used the Five C's of Credit Analysis to guide their business lending decisions.

Education Fund of America[TM] Launches "Seven C's of EB-5 Investing" Program-New Program Helps Foreign Nationals Evaluate EB-5 Project Risks and Job Creation

Credit Management 101, teaches that the best way to shrewdly evaluate credit and anticipate problems is by adhering to the basics, otherwise known as the Five C's of Credit.

Do you have a plan B?

Such a customer unwittingly violates the "character" requirement in the five C's of credit and should be referred to legal counsel for litigation.