Question

How does a low credit score affect a person who applies for a loan?

OA. It makes it easier for the person to get a loan with a poor debt-to-
income ratio.
B. It allows banks to give the person a loan without checking his or
her tax records.
C. It makes banks more likely to give the person a large, long-term
loan.
OD. It causes banks to charge the person higher interest rates on the
loan.
SUBMIT

Answer 1

A low credit score can cause banks to charge the person higher interest rates on the loan. This is because a low credit score indicates that the person has a history of not paying their debts on time or in full. As a result, banks may view the person as a high-risk borrower and charge them higher interest rates to compensate for the increased risk. A low credit score can also make it more difficult for the person to qualify for a loan, especially if they have a poor debt-to-income ratio.