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Vlada [557]
3 years ago
13

Why are applications for new credit a concern for credit companles?

Social Studies
1 answer:
lutik1710 [3]3 years ago
5 0

Answer: They show an extension of debt.

Explanation:

Generally speaking, the more debt a person has, the less the likelihood of them being able to pay the entire debt back because it might become too much for them.

For this reason, credit companies generally frown on people taking out more debt which is why when a person applies for new credit, credit companies mark down a person's credit rating to show that the person's risk of not paying back their existing loans has increased.

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