The 5 Cs of Credit

From Kelly Kendrick, Assistant Vice President of First Bank and Trust Company:

Greetings from Kelly Kendrick of First Bank & Trust Company Whether you’re seeking a business loan, a car loan or a mortgage for your home, you probably question what factors will be considered by the bank during the approval process for your loan.  The basic criteria that banks use to evaluate your loan request for approval are referred to as the 5 Cs of credit.

  1. Character – Is the customer dependable, honest, and reliable? What is the reputation of the customer? Does the customer have good credit history, indicating that they were willing to meet prior obligations?
  2. Capacity – Does the customer have adequate cash flow to repay the loan or take on additional debt?
  3. Capital – For consumer loans, what will the customer be contributing toward the purchase? For business loans, in addition to the contribution toward the purchase or the project, what has the customer invested in the growth of their company?
  4. Collateral – What is the customer offering to provide additional security and mitigate risks of the loan?
  5. Conditions – What are the current market conditions affecting the customer or their company?

The 5 Cs of credit may be a helpful tool in assessing your financial situation before you go to the bank if you may be considering applying for a loan.

You're invited to read about the 5Cs of Credit and more in The Basics of Business Bank Loans (.pdf) from First Bank and Trust Company.


First Bank & Trust Company, one of the top community banks in the United States, is a diversified financial services firm with office locations in southwest Virginia, northeast Tennessee, and the New River and Shenandoah Valleys of Virginia.  Financial objectives are addressed by offering free checking products for personal and business accounts, and assessing lending solutions managed by mortgage, agricultural and commercial lending divisions.  Comprehensive financial solutions are available through trust and brokerage service representatives. 

For businesses, First Bank & Trust specializes in business loans, business credit, and business finance.

You're invited to read more about First Bank & Trust Company on Handshake 2.0.  First Bank & Trust Company is a client of Handshake Media, Incorporated, the parent company of Handshake 2.0.

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