Credit Worthiness, Explain The Concept Of Creditworth (Research Paper Sample)
1. Explain the concept of “creditworth”.
2. State why it's important to understand the “creditworth” of each of the Client, the Sponsors/Developers, the D&B contractor, his supply chain and subcontractors, and the Operations contractor(s) etc.
3. Who are the advisers? Are there any conflicts to be wary of in appointing advisers?
Credit worthiness illustrates the kind of risk that the lender may be exposed to or associated from the borrower. It is normally carried out to determine the lenders probability of defaulting to meet his or her obligation as agreed (Broecker, 2016). The concept takes into account factors such as the repayment history and the credit score of the borrower.
Sponsors or developers credit worthiness is very essential since it enables one to identify their ability to sustain the project that they are intending to carry out (Miles, 2015). It determines the duration which will be used so as to complete a certain project. This enables one to make decisions according to the project duration that is whether its worthy or not.
D&B contractors normally carry out construction, welding and plant maintenance challenges so as to ensure successful completion of a project. Their credit worthiness determines how activities which involve cash will be carried out and in which order will be followed (Miles, 2015). The D&B contractors must have a credit worthiness which will make sure that the supplier is supplying materials at the required time.
Also their worthiness ensures that the sub contactors are carrying out their obligation as expected since they are getting the cash to ensure that the activities are carried out as expected (Broecker, 2016). The operational contractors also depend on the credit worthiness of the D&B contractor since it influences on how the operational contractors will carry out their roles in respect to the intended operation.
The financial advisors have the technical know-how of determining the credit worthiness. They are usually in a position to ascertain the available assets...
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