What Credit Analysts Look for

Credit analysts are professionals who are skilled at gathering and analysing financial data, with the intention of assisting credit providers with making sound, informed financial decisions. They can be highly useful for assessing creditworthiness of individuals, entities or securities.

Their findings are used to determine the likelihood that a borrower can repay his/her debts. They do this by reviewing credit history.

Credit analysts essentially evaluate the levels of risk, which then helps them determine the interest rate and credit limit or loan terms for borrowers.

What credit analysts look for when analysing individuals or businesses:

Warning signs that may indicate financial risks

Credit analysts look for signs that may be red flags, such as late payments or missed payments. By identifying these risks sooner, it becomes an easy way of working out which borrowers should qualify and which ones need to improve their credit standing before applying.

Data that can help to determine whether to increase or reduce credit limits

Credit analysts look for information that will make it as easy as possible for credit providers to work out how much money to loan to borrowers along with the rates of interest to be charged. This is dependent on creditworthiness data.

Levels of risk

These analysts are looking for information that will be a clear indicator of how much risk a borrower presents. Their credit score is considered here, along with their previous credit payment history.

Reports are compiled, which are based on the findings from the analysis. They are then used to make recommendations on credit-granting decisions.

Data that can be highly useful for recommending either approval or denial of a loan application

This includes information that indicates that the borrower already has too much debt or that they are about to reach their credit limits. This is often an indicator of poor management of credit.