What is creditworthiness and how is it calculated?

Creditworthiness represents our economic and financial reliability, and it is essential to obtain the right conditions in a loan

Anyone who is about to apply for a loan should familiarize themselves with certain terminologies. We have already talked about the credit score. Creditworthiness is another parameter that measures our reliability as Applicants. The mechanism is simple: the lower our level of creditworthiness, the higher the cost of the loan we are given.

For this reason, obtaining a correct assessment of creditworthiness is fundamental: it allows us to obtain the best possible loan conditions.

Creditworthiness: what it is and why it matters

Creditworthiness: what it is and why it matters

The credit rating is a useful indicator to know what interest rate we deserve and how sustainable our debt situation is . Its value may vary depending on the weight attributed to the various variables and the financial intermediary to whom it is requested.

Credit score: in Italy it is creditworthiness

Abroad they call it the credit score: it identifies the personal rating and is summarized by an index. It is an independent evaluation of one’s merit, prepared by specialized institutions that support the applicant in becoming aware of his / her credit profile (the same principle for which Best bank interrogates external databases).

The 4 advantages of using the Credit Score

The 4 advantages of using the Credit Score

People can get loans faster.

Scores help financial intermediaries speed loan approvals, even in minutes.

Loan decisions are fairer.

Using credit scores, financial companies can focus only on credit risk facts, rather than on the applicant’s personal aspects.

More credit is made available.

Financial companies that use credit scoring can approve multiple loans because the score gives more accurate information about individuals, allowing you to have a better understanding of the risk they are taking.

Interest rates are lower.

Automated credit scoring processes make the credit granting process more efficient and less expensive.

The 7 creditworthiness profiles

 

The 7 creditworthiness classes underlying the functioning of the Best bank platform, which determine the interest rate that the applicant can obtain are:

In this way, the Providers can also know the risk profile of the Applicants, or the risk that the debtor does not fulfill (even only partially) his repayment obligations.

For this reason, Best bank does not include applicants with too low a creditworthiness profile in its marketplace.

Creditworthiness: independent and rapid evaluation with Best bank

Creditworthiness: independent and rapid evaluation with Best bank

The criteria that Best bank invites you to consider are:

  • Size and stability of available income streams
  • Debt level
  • Behavior in the payment of previous loans
  • Other socio-demographic elements (such as age, profession, residence, …)
  • The behavioral profile

Here is an example of a self-assessment of creditworthiness

A profile in class “A – Excellent” corresponds to a stable income which is well above the expected installment, a low level of debt and an impeccable credit history in repayments.

Why is the creditworthiness profile important for Best bank?

Because P2P Lending is a personal loan between people .

Each Applicant who approaches the loan can serenely evaluate his debt capacity, the sustainability of the monthly installment and will undertake, with the Lenders who finance it, to meet his commitments.

In fact, the repaid installments do not benefit banks or financial companies , but preserve the money of other people who have trusted the Applicants instead of investing elsewhere.

Because our goal is to collect responsible and informed credit requests.

Each simulation determines an installment inclusive of all the costs of the loan. No unsolicited products or hidden costs are added to the offer calculated by the Simulator.

So when comparing different personal loans, in order to have the correct terms of comparison, it is important that all costs are included in the calculation of the final installment.

Because thanks to the credit rating, we select the most reliable users and offer them the best conditions.

In fact, the Best bank loans are:

  • customized loans,
  • private loans,
  • fixed rate,
  • 100% online,
  • repayable in fixed monthly installments,
  • early repayment has no additional charges e
  • there are no ancillary insurance products.

By assessing the credit profile of each individual applicant, we reduce the risk of exposing our community to fraud or insolvency.

And we grant the most advantageous rate to the most deserving applicants.

Are you one of them?

Calculate the installment and find out

Creditworthiness, real-time evaluation

If the credit assessment is correct, Best bank will offer a loan under the conditions indicated by the simulator. If the class of merit attributed to the applicant is different, it will offer different conditions, based on the information from the databases. The higher the credit rating, the lower the cost of the loan. And the greater the advantage of having chosen Best bank.

In this way, the Applicant will not pay more than he owed to his credit profile.

And he will have a real tailor-made loan.

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