ECONOMICS
CREDIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Amount of the loan
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Fees attached to the loan
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Interest rates on the loan
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Length of time for the loan
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Detailed explanation-1: -Rate of Interest and Other Charges: After you have decided on the amount you want to borrow, you must check out the most crucial factor that determines the total cost of your loan-the interest rate. This interest rate is based on several factors like your income, your creditworthiness, the company you work for, etc.
Detailed explanation-2: -The first thing that a lender looks at while evaluating an application for a personal loan for a salaried professional, is the credit score. A good credit score, i.e., above 700, can help you get loans at a cheaper rate of interest as well.
Detailed explanation-3: -The two main components to consider when determining the cost of borrowing money are the principal amount and the interest.
Detailed explanation-4: -Your income and employment history are good indicators of your ability to repay outstanding debt. Income amount, stability, and type of income may all be considered. The ratio of your current and any new debt as compared to your before-tax income, known as debt-to-income ratio (DTI), may be evaluated.
Detailed explanation-5: -Standards may differ from lender to lender, but there are four core components-the four C’s-that lender will evaluate in determining whether they will make a loan: capacity, capital, collateral and credit.