197k views
3 votes
What is most likely to cause a lender to deny credit?

Group of answer choices

Few credit and loan applications

A low debt-to-credit ratio

Missed payments on revolving credit

Variety of credit type used

2 Answers

4 votes

Answer:

Step-by-step explanation:

Missed payments on revolving credit

User Hgbnerd
by
4.5k points
4 votes

Answer:

Missed payments on revolving credit

Step-by-step explanation:

Lenders use credit history and income level to assess the borrower's ability to repay a loan. Missing on installment payments or defaulting on revolving credit payments is indicative of a high-risk borrower. The lender will judge such a customer are highly likely to default on the loan.

Missing installments could communicate an inability to repay due to inadequate income, too many debts, or poor money management. Lenders will reject a loan application from such a borrower due to the high risk of lending to the customer.

User Abhishek Dujari
by
5.1k points