Factors Determining Credit Worthiness of Low Income Consumers

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Abstract
The purpose of this study was to identify variables that can be used in granting credit to low income consumers. Credit behavior, as exemplified by loan repayment, was examined with respect to economic, demographic, and socioeconomic characteristics of borrowers from a credit union that had been established to serve low income people in Columbus, Ohio.Findings indicate that early warning signals—default and delinquency—are given by borrowers when a loan is going bad. Consumer education and financial counseling might help eliminate this problem.

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