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His colleague at Mississippi State, Tom Miller Jr., is a finance professor who has written a book on consumer lending, in addition to providing his expertise to policymakers.Credit scoring assesses the likelihood of default Lenders stay in business when borrowers pay back loans.Some borrowers consistently make prompt payments, while others are slow to repay, and still others default meaning they do not pay back the money they borrowed.
How do credit scores work? Two finance professors explain how lenders choose who gets loans and at what interest rate.