What is loan grading?

Sharad Jaiswal
Sharad Jaiswal

Posted On: Mar 18, 2020

 

Loan grading is used to assign a quality score to a loan based on the credit history of the borrower, quality of the collateral, and the likelihood of the repayment. This core takes not only the borrower’s credit score into account but also a combination of several indicators of credit risk from the credit report and loan application. This loan grading task is done as a part of the lending institution’s loan review system.

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