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
