5 C's of credit

Definition

The five key elements a borrower should have to obtain credit: character (integrity), capacity (sufficient cash flow to service the obligation), capital (net worth), collateral (assets to secure the debt), and conditions (of the borrower and the overall economy).

Use 5 C's of credit in a sentence

You should always make sure that you are following everything set forth by the 5 c's of credit and don't break them.

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The company was denied the loan because it failed to meet three of the 5 C's of credit: capacity, collateral, and conditions.

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In order to successfully borrow money for credit its is important that the borrower has certain standards that are called the 5 C's of credit. Possessing the 5 C's of credit shows that the borrower is reliable.

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