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- Investigate the procedures in your financial institution in granting credit cards and the possible benefits and drawbacks to the institution.Which of the following roles is considered a main objective of credit rating agencies? a. Granting loans to borrowers b. Lessen information asymmetry. c. Underwriting securities d. Receiving investments from capitalists. e. Taking deposits from saversWhich of the following is not use to assess whether credit should be extended to a household? a. The amount of income earned. b. The amount of debt outstanding. c. The history of timely repayments of debt owed. d. Whether the loan is secured by an asset. e. All of the above are used to assess credit.
- Investigate the procedures in your financial institution or a bank of your choice, in granting credit cards and the possible benefits and drawbacks to the institution of this instrument.How do you think the information stated in the credit report and credit score are sufficient enough to know the credit standing of the borrower?How does credit scoring operate, and how are we as consumers and users of credit effected by it?
- Which of the following pieces of information would you not expect a potential credit customer to provide in a credit application form? A.The name of their spouse and their spouse's personal bank account details B.the name of their bank C.a list of other debts D.a list of assetsWhich if the following is not true of the 5Cs in evaluating credit quality A Character refers to the integrity and honesty of the borrower and applies to both individuals and companies B Capital refers to the savings or wealth of the borrower as an additional source of income to repay the loan C Collateral refers to assets that are pledged to lender D Capacity refer to external factors including the state of economy that can impact the borrower’s source of income.What are the advantages and disadvantages of implementing credit scoring within a financial institution?THESE QUESTIONS REQUIRE YOU TO STATE WHICH OF THESE ITEMS BELONG TO ADVANTAGE OR DISADVANTAGE. (ANSWER A – ADVANTAGE / B – DISADVANTAGE) *
- Explain what important information we can get from each sources of credit information to be able to make a decision whether or not we can extend credit to the loan applicantWhich of the following is true of a credit applicant's character? a. It reflects any unique conditions surrounding a credit applicant's transaction. b. It reflects the level of liquid assets available with a credit applicant. c. reflects a credit applicant's past payment history. d. It reflects a credit applicant's ability to repay his debt obligation.What are the primary tools, and how are they used by lenders when determining whether they will lend money to you? PLEASE CITE REFERENCES
