what is creditworthiness 
creditworthiness is a measure of how likely you will default on your debt obligations according to a lender s assessment or how worthy you are to receive new credit your creditworthiness is what creditors consider before they approve any new credit 1understanding creditworthinessyour creditworthiness tells a creditor just how suitable you are for the loan or credit card application that you filled out the decision that the lender makes is based on how you ve dealt with credit in the past lenders periodically review different factors your overall credit report credit score and payment history your credit report outlines how much debt you carry the high balances the credit limits and the current balance of each account it will also flag any important information for the potential lender including whether you ve had any past due amounts defaults bankruptcies or collection items 1creditworthiness is determined by several factors including your repayment history and credit score some lending institutions also consider available assets and the number of liabilities you have when they determine the probability of default 1your creditworthiness is also measured by your credit score which is a three digit number based on factors in your credit report a high credit score means your creditworthiness is high while a lower credit score indicates lower creditworthiness payment history also plays a key role in determining your creditworthiness lenders generally don t extend credit to someone whose history demonstrates late payments missed payments and overall financial irresponsibility if you ve been up to date with all your payments the payment history on your credit report should reflect that payment history counts for 35 of your fico credit score so it s a good idea to stay in check even if you have to just make the minimum payment 3your creditworthiness is important because it will determine whether you get approved for a new loan like a car loan or a credit card the more creditworthy you are the more likely you will be approved for better interest rates which can save you significant money it can also affect employment eligibility insurance premiums business funding and professional certifications or licenses 1checking your creditworthinessthe three prominent credit reporting agencies that measure creditworthiness are equifax experian and transunion lenders pay credit reporting agencies to access credit data on potential or existing customers in addition to using their own credit scoring systems to grant approval for credit every consumer should keep track of their credit score because it is the factor used by financial institutions to decide if an applicant is eligible for credit preferred interest rates and specific credit limits you can request a free copy of your credit report once each year at annualcreditreport com or you can join a free credit monitoring site like credit karma credit sesame or another credit monitoring service 