Finance Credit Score Rubric
Finance Credit Score Rubric
Document Overview
This Finance Credit Score Rubric is designed to evaluate the creditworthiness of a business. It provides a systematic approach for assessing various financial factors that contribute to the overall credit score. This rubric is an essential tool for financial analysts, credit officers, and decision-makers in [Your Company Name] to make informed lending or credit decisions.
Rubric Components and Scoring
A. Credit History (35%)
Evaluates the duration and consistency of credit history.
|
Criteria |
Description |
Points |
|---|---|---|
|
Length of Credit History |
More Than 10 Years |
10 |
|
5-10 Years |
7 |
|
|
2-5 Years |
4 |
|
|
Less Than 2 Years |
2 |
|
|
Payment History |
No Late Payments |
10 |
|
1-2 Late Payments |
7 |
|
|
3-5 Late Payments |
4 |
|
|
More Than 5 Late Payments |
1 |
B. Debt-to-Income Ratio (30%)
Measures the proportion of debt relative to income.
|
Criteria |
Description |
Points |
|---|---|---|
|
Debt-To-Income Ratio |
Below 15% |
10 |
|
15%-30% |
7 |
|
|
31%-45% |
4 |
|
|
Above 45% |
2 |
C. Credit Utilization (20%)
Assesses the amount of credit used compared to the credit limit.
|
Criteria |
Description |
Points |
|---|---|---|
|
Below 30% |
10 |
|
|
Credit Utilization |
30%-50% |
7 |
|
51%-70% |
4 |
|
|
Above 70% |
1 |
D. Type of Credit in Use (10%)
Examines the diversity of credit types.
|
Criteria |
Description |
Points |
|---|---|---|
|
4 or More Types |
10 |
|
|
Type of Credit |
3 Types |
7 |
|
2 Types |
4 |
|
|
1 Type |
2 |
E. Recent Credit Inquiries and New Accounts (5%)
Focuses on the frequency of new credit inquiries and accounts.
|
Criteria |
Description |
Points |
|---|---|---|
|
0-1 |
5 |
|
|
Recent Inquiries/Accounts (Past Year) |
2-3 |
3 |
|
4-5 |
2 |
|
|
More Than 5 |
1 |
Each section of the rubric is designed to collectively assess the overall creditworthiness of a business. Points are allocated based on the specific criteria within each category, contributing to the total credit score.
Scoring Table:
|
Component |
Maximum Points |
Score Earned |
Percentage of Total Score |
|---|---|---|---|
|
Credit History |
20 |
32 |
35% |
|
Debt-to-Income Ratio |
10 |
[Score] |
30% |
|
Credit Utilization |
10 |
[Score] |
20% |
|
Type of Credit in Use |
10 |
[Score] |
10% |
|
Recent Credit Inquiries |
5 |
[Score] |
5% |
|
Total |
55 |
[Score] |
100% |
Interpretation of Scores:
-
41-55: Excellent Creditworthiness
-
31-40: Good Creditworthiness
-
21-30: Fair Creditworthiness
-
11-20: Marginal Creditworthiness
-
0-10: Poor Creditworthiness
