What is ‘A-Credit’
The highest credit grade available as assigned to a borrower by a lender. Lenders use a credit grading system to qualify borrowers. The higher the borrower’s credit grade, the lower the interest rate offered to that borrower on a loan.
Explaining ‘A-Credit’
Credit grading by lenders is based on many factors, including a borrower’s FICO score, debt-to-income ratio, loan-to-value ratio and past delinquencies. This grade of credit may be associated with a plus or minus for more depth. In this case, a grade of “A+” would indicate higher credit worthiness than a score of “A-“.
Further Reading
- An economic theory of a credit union – www.jstor.org [PDF]
- Are we experiencing a credit crunch? – ideas.repec.org [PDF]
- A credit scoring approach for the commercial banking sector – www.sciencedirect.com [PDF]
- On the design of a credit agreement with peer monitoring – www.sciencedirect.com [PDF]
- Are credit ratings valuable information? – www.tandfonline.com [PDF]
- Evaluating a credit guarantee agency in a developing economy: a non‐parametric approach – www.emerald.com [PDF]
- How will a credit crunch affect small business finance? – ideas.repec.org [PDF]
