Question

Why did Jon's lender most likely approve his loan?

Answer 1

The reason why Jon's lender most likely approved his loan is because;

A: He has been making most payments on time.

There are different reasons why lenders approve money for those who want to borrow but for the sake of this question, we will just access the options.

• A) He has been making most payments on time; This option is correct because the question tells us that they are his lender and it means he must have history with them and they have seen that he always pays his debts on time. This is one of the primary reasons why lending companies approve loans.

• B) He has one credit card; Credit cards are cards issued by financial institutions that allows cardholders to borrow funds to be used to pay for goods and services to merchants that accept usage of cards for payment. Thus, this has no bearing on approval of loan because number of credit cards alone does not determine the capacity to pay back.

• C) He has a historic credit score of 300; A credit score is a score that determines a borrowers creditworthiness. A score of 300 is considered to be very low and as such shows the borrow is not credit worthy for a loan.

• D) He has a high debt-to-available credit ratio; This means you have more debt to pay than credit and as such it means a high ratio shows that you are higher-risk borrower that will have difficulty paying back any loan given to you.

Read more on giving out loans by financial institutions at; brainly.com/question/14997152