1. THE 5 C’S OF CREDIT

2. Character Your attitude towards meeting your credit obligations

3. Character Do you pay your bills on time?

4. Character Have you ever filed for foreclosure or bankruptcy?

5. Character Foreclosure: when a homeowner is unable to make payments on his/her mortgage. It allows the lender (bank) to evict the homeowner and sell the home Bankruptcy: when a person is unable to pay their debts. An individual declares in court to settle debts and start over financially.

6. Character Are you a party to a lawsuit?

7. Collateral The asset you pledge to ensure that you will make payments

8. Collateral Do you own real estate?

9. Collateral Do you own precious metals?

10. Collateral Lender can take ownership if you are unable to pay loan

11. Capacity Can you repay the loan?

12. Capacity What is your debt to income ratio?

13. Capacity What are the loan terms (APR, length)?

14. Capacity Are you a co- signer on other loans?

15. Conditions The general environment conditions that will affect your ability to pay

16. Conditions Is the economy growing?

17. Conditions How long have you worked for the same employer?

18. Conditions What is the long- term outlook for your occupation?

19. Capital What are your financial resources?

20. Capital What is your net worth? (Assets minus liabilities)

21. Capital Do you have emergency savings?

22. Capital How liquid are your assets? (Can they be converted to cash?)