Associate Level Material

Appendix C
The Five Cs Worksheet
Directions: Identify the following factor descriptions to their corresponding C of credit. The five Cs are listed below: Capacity Capital Collateral Character Conditions Which C? capacity conditions capital collateral collateral capacity condition character character capital

Condition Your household cash flow helps to determine this C: Under these __________, you may still be approved with a cosigner This demonstrates how much your assets are worth. Using your car or house as a promise to pay This makes you a better credit risk to the lender Lenders will evaluate your debt-payment ratio. The lender is taking your unique situation under consideration. Previous credit history This shows how long you have worked for your employer and if you have obtained an education. Having more at stake may make you less likely to default on a loan.

FP/101