What is creditworthiness?

Creditworthiness Definition: Creditworthiness refers to how a lender measures the ability of a borrower to repay a debt and the degree of risk involved. This factor is one of the most important when assessing a potential borrower or setting up a new account.

A company or individual account with a vendor may apply for credit to purchase items and pay for them at a later date, which also requires good creditworthiness. Creditworthiness is how a lender can tell if a borrower will fulfill their obligations based on their credit history and score. The most common way to improve creditworthiness is by making payments on time and fulfilling loan obligations.

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Other credit report terms:


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