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bob and karen are both applying for a consumer loan. they both have the same current level of income and the same current level of debt. why might karen be more likely to get the loan if karen is younger?

User Atoumey
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1 Answer

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There are a few reasons why Karen might be more likely to get the loan if she is younger, even if she and Bob have the same current level of income and debt:

Age is often considered a factor in creditworthiness because younger people are generally considered to have a longer borrowing horizon than older people. This means that lenders may consider Karen to be a lower risk borrower because she has more time to repay the loan.

Karen may have a longer credit history than Bob, which could make her a more attractive borrower to lenders. Credit history is often considered an important factor in loan decisions because it reflects a borrower's past credit behavior and can be a good indicator of future creditworthiness.

Karen may have a higher credit score than Bob. Credit scores are used by lenders to assess the risk of lending to a borrower, and higher credit scores are generally considered a sign of lower risk. Karen may have a higher credit score because she has a longer credit history, has made timely payments in the past, and has a lower level of debt relative to her credit limits.

Overall, Karen may be more likely to get the loan if she is younger due to a combination of factors such as a longer borrowing horizon, a longer credit history, and a higher credit score.

User Kul
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