A credit score is a number between 300 and 850 that reflects a consumer’s creditworthiness.
There are three main credit bureaus: Equifax, Experian and TransUnion.
Credit score plays a key role in a lender’s decision to offer a loan.
The FICO scoring system is used by many financial institutions.
Factors considered in assessing creditworthiness include repayment history, types of loans, length of credit history, and total debt of the individual.
One of the metrics used in calculating a credit score is credit utilization – the percentage of available credit that is currently being used.
It is not always recommended to close an unused credit account, as this can lower a person’s credit score.
Good credit is a classification of a person’s credit history, indicating that the borrower has a relatively high credit rating and is a safe credit risk.
Bankruptcy is a legal proceeding carried out in order for individuals or legal entities to be freed from their debts, while at the same time providing creditors with the opportunity to repay them.
A debtor in possession (DIP) is an individual or entity that has filed for Chapter 11 bankruptcy protection but still owns property that creditors have legal claims under a lien or other lien.